The EUR has seen its value increase against GBP and the USD over recent days, despite some potentially worrying signs emanating from the Eurozone and its economy. More on the political uncertainty from within the bloc and globally in the market report below, with the table showing the difference in GBPEUR exchange rates during the high and low trading points for the past month.

Currency Pair% ChangeDifference on £200,000

GBP/EUR rates have moved back below 1.12, following what seems like a complete stalemate in the current Brexit negotiations. This has inadvertently helped drive the EUR value higher by sapping confidence in Sterling, causing investors to sell off their GBP currency positions, thus weakening its value.

EUR/USD rates have also spiked, with the single currency making inroads towards 1.18 against the greenback during Tuesday’s trading.

These positive moves against two of the world's most traded currencies have come despite a drop in Eurozone exports, which in turn has driven a slowdown in the Eurozone economy.

Manufacturing PMI figures fell to a four-month low of 54.2 in September, down from 54.5 in August.

Brexit talks enter last drive for a deal

What are the potential pitfalls facing the Eurozone economy?

Business Confidence figures have also fallen, due to “a near stagnation of exports” according to data firm IHS Markit.

An escalating trade war between the US and EU, political uncertainty inside the Eurozone and Brexit have all been cited as the key reasons for the slowdown.

This current negative perception is at odds with the general consensus last month, when economic data indicated that the Eurozone economy was navigating the potential pitfalls above without any major downturn.

This goes to show how quickly market perception can change. The EU is not immune to the current Brexit saga and separation from the UK is likely to negatively impact the EU economy as well as the UK’s. This has not been focused on for the most part by the UK media but it is a reality that the EU cannot escape.

Add to this even more pressing concerns regarding the trade tariffs implemented by President Trump, and the knock on effects this could have on the medium to longer-term economic growth inside the Eurozone.

Whilst market conditions can change quickly, I would be very tempted to take advantage of the recent spike in value and avoid the potential pitfalls lying ahead.

For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.