This Euro report will address the factors that are likely to affect exchange rates in the short term if you are buying abroad or making a currency transfer. The table below shows the difference in Euros you would have achieved when buying £200,000 at the high and low points during the last 30 days.
|Currency Pair||% Change||Difference on £200,000|
ECB President Mario Draghi remains bullish about the Eurozone economic growth. The current monetary policy programme is working but with high unemployment across many countries within Europe and inflation levels still at a lacklustre low of under 1.2% there is still a huge amount of work that lies ahead. In my opinion, I feel we may see an interest rate hike before the end of 2017 within the Eurozone, Mr Draghi is keen on tightening his QE programme and in turn would like to raise interest rates.
Within Europe, recent headlines have all been about Brexit and the recent UK election, but now as things start to settle down again in my view the Greek debt crisis will start to rear its ugly head again. With Greece likely to need a 4th bailout next year the country is very much in political turmoil, many people in Greece are keen to leave the Eurozone and not to be held ransom by huge annual debt repayments. With so much uncertainty ahead this does not bode well for the strength of the euro.
In my view Brexit will ultimately harm the EU as well as the UK, the currency markets have not focused on this yet and when they do this could add pressure on the euro. Clients with selling Euros should take advantage now of the excellent exchange rates and maximise their transfers now, rather than waiting to see if the rate may move further in their favour.
It is a fairly quiet week ahead in terms of data releases for the Eurozone, we do have services PMI data release this morning for many of the Eurozone nations, and slightly later this morning we have European retail sales data release out at around 10am which is expected to be slightly lower than expected. If there is a huge swing in any of these data releases expect to see some market movement.
Thank you for reading today's Euro report, if you have any questions about an upcoming transfer I would be more than happy to discuss them – you can contact me with any queries here.
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