Amidst the current uncertainty surrounding Brexit, the euro is currently experiencing 2-month highs against the pound, with mid-market levels ending last week trading around 1.1570.
|Currency Pair||% Change (Month)||Difference on £200,000|
Despite this, the single currency is still on a downward trend against the US dollar, with current interbank levels below 1.12, which is the lowest the pairing has been since June 2017.
The euro is still approximately 5 cents from its strongest positions against the pound this year and there’s argument to suggest that sterling has found stability above 1.15, which the pairing has remained above since the end of February.
Market analysts will be closely watching the upcoming EU Parliamentary elections next month, as they could provide and insight into the next steps for the UK-EU divorce and could in turn influence euro market sentiment.
With key focus surrounding European political developments across Europe, the results following the Spanish general election yesterday could have an impact on euro sentiment this week.
Considering the country has held it’s 3rd general election in the last 4 years, there could be concerns over the political landscape of the eurozone’s 5th largest economy and since the election has been marked by the rise of the far-right movement Vox, which has threatened to end the self-rule for regions such as Catalonia, which could in turn put pressure on the single currency.
This week, the latest Gorss Domestic Product (GDP) and inflation data, in the form of the Consumer Price Index (CPI) will be released for the eurozone.
Tomorrow’s GDP release is expected to show no change for the annualised figure, but there is expected to be a 0.1% increase from the previous quarter which could encourage euro gains.
On Friday, inflation data for the eurozone is expected to show an increase by as much as 0.2%, which could also lead to euro strength.
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