The preliminary Eurozone inflation data for the month of December came in 0.1% better than expected for both the monthly and yearly comparisons. The latest increase puts Eurozone inflation rising annually at the highest pace for over 3 years. With inflation levels continuously rising there is likely to be more calls for Mario Draghi to increase the interest rate which currently sits at 0%. There were also positive readings on the Markit Services PMI data, suggesting decision makers across the Eurozone are positive for the near future.

The results for Germany and France were better than expected however it’s worth pointing out that the reading for Italy whilst positive was not as good as expected.

ECB meeting accounts

Tomorrow there will be Producer Price Index releases for November with the Month on Month and Year on Year results expected to show falls of over half a percent. Later on, in the afternoon the ECB Monetary Policy Meeting Accounts which contain an overview of current economic conditions will be released. Considering recently European Central Bank President Mario Draghi announced there would be an extension to the current Quantitative Easing program. The meeting accounts could shed more light on the details of the new program, with analysts expecting the monthly Asset Purchasing budget to drop from €80bn to €60bn a month from April.

The next 12 months could see the Eurozone turn into a very different place with several key elections and major nations on the verge edge of economic collapse. In the space of the last 2 months a €200,000 purchase would have cost the difference of over £15,000 between the high and the low. If you’re looking to purchase a property in the near future purchasing currency now could avoid any unwanted surprises from the currency markets.

Why not discuss your currency requirement with a dedicated broker? With a number of political events likely to shape GBP/EUR this year, making a transfer between the highs and lows could save you thousands. Call us on 01494 725 353 or email me here if youd like to discuss any of the details in this report.

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