This Euro report looks at the factors that could effect the rate of exchange for your currency transfers in the short term. The table below shows the difference in Euros you would have achieved when buying £200,000 at the high and low points over the last week.

Currency Pair% ChangeDifference on £200,000
GBP/EUR1.73%€3900
GBPEUR to hit 1.10

Investors cautious over ECB decision

The markets are eagerly awaiting the latest interest rate decision and guidelines regarding future monetary policy from the European Central Bank (ECB) today.

I think that the markets have largely priced in the outcome for today’s meeting already with reports indicating that there will be no tweaking to monetary policy just yet. The Euro had benefitted of late following rumours that they will likely start to unwind their €60BN Quantitative Easing (QE) programme. However, reports are indicating that the ECB won’t start to reduce their asset purchasing programme until early 2018 with the official announcement expected in Septembers meeting.

Why won’t they raise interest rates?

Although Inflation in the Eurozone has been steadily increasing, it is still well below the target of 2% set by the ECB and until inflation nears this figure, I don’t expect Mario Draghi to change his dovish tone.

Recent data releases from the bloc have done little to help a case for raising interest rates or tapering monetary policy just yet. The ECB’s Bank Lending Survey indicated that in short the ECB are still desperately trying for consumers and businesses to borrow by easing credit standards, coupled with falling business sentiment across the Eurozone. One real concern is the slowdown in business sentiment from the driving force of the Eurozone.

My personal opinion is that the Euro will lose value today. I personally think that Draghi will carry his dovish tone and won’t give much for investors to chew on just yet. It is worth nothing that Mario Draghi has confirmed his attendance at the Jackson Hole Symposium in September where it is expected he will give some indication then.

For more information on how future data releases could affect your Euro 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.