The Italian election failed to select an outright leader, and some investors are surprised to see that this didn't cause any Euro weakness. This Euro report discusses how further political uncertainty could affect the currency. The below table shows the difference in Euros you would have achieved when buying £200,000.00 during the high and low points yesterday.
|Currency Pair||% Change||Difference on £200,000|
Despite a quiet end to the week for the UK economic data, there’s no shortage of economic updates out of the Eurozone this week that could potentially move the markets.
Early this morning a number of European Central Bank members will be speaking, starting with the most important member, Mario Draghi the ECB President. He’s been President since 2011 and generally speaking the Euro tends to strengthen when he speaks although this is a trend some believe he’s attempting to buck, as described by my colleague Dayle in yesterday’s market report.
There will also be Industrial Production figures along with Employment changes later this morning at 10am UK time, with a reduction in Employment expected. I would expect to see the Euro weaken if the drop in Employment is greater than the 0.3% expected.
There will be further speeches from key ECB personnel as the week continues with Brexit expected to be a focus. In situations like this it’s worth making us aware if you wish to notified in the event of a market move, as the changes could happen at any time.
EU Inflation levels will be under the spotlight this Friday, with figures released at 10am that morning.
Some economists were surprised by the lack of Euro weakness after the Italian election failed to determine an outright leader, resulting in Matteo Renzi stepping down from his position.
I think there could be a further twist in this tale as a number of Eurosceptic parties performed well during the election, and talk of how the Euro limits almost every country using it minus Germany from managing its monetary affairs gathers pace. Formal coalition talks in Italy will begin as the EU summit in Brussels ends later this month. Those of our clients with a Euro based currency requirement may wish to plan around these events, as there could be a busy end to the month for EUR exchange rates.
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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