Currency Update from Currencies Direct - Costa del Sol

  • Hopes for positive Brexit deal push GBP/EUR exchange rate higher

    Staying on top of the latest currency news can help you time your transfers more effectively, so find out what you should be looking out for over the next couple of weeks…

    Latest currency news

    The pound has been bolstered by Brexit news over recent weeks, although a GBP/EUR exchange rate rise hasn’t been replicated against the US dollar.

    With little interruption, the pound euro exchange rate has risen from an opening rate of €1.11 to €1.13. On the other side, EUR/GBP has dropped from £0.89 to the £0.88 - £0.87 region.

    Less impressively, GBP/USD opened at $1.30 and hit highs of $1.31 and lows of $1.29 over the past two weeks, but has returned to the $1.30 range. EUR/USD has fallen from $1.17 to $1.14.

    What’s been happening?

    The pound has advanced against the euro over the past two weeks, thanks to tentative hopes for an early Brexit agreement.

    UK data has been less supportive, showing slower Q2 GDP growth and sluggish construction and services sector activity.

    Despite the negative UK data, GBP/EUR still advanced thanks to high uncertainty about the Italian budget.

    Italy’s new coalition government proposed a budget that exceeded EU spending limits, which led to a tense standoff.

    The pound couldn’t completely overpower the US dollar over the past fortnight, with news of a new North American trade deal supporting the US currency.

    What do you need to look out for?

    Over the next two weeks, the main UK data to watch out for will cover GDP growth, wages, unemployment, inflation and retail sales.

    Forecasts aren’t too supportive, as slowing GDP and wage growth is predicted alongside lower inflation rates and retail sales.

    Brexit talks could prove the wildcard, especially if a pound-boosting breakthrough is announced.

    Euro traders will have Eurozone industrial production stats in focus this week – negative results could push the euro down against the pound.

    Beyond this, next week’s news is all about Eurozone inflation – a forecast-matching rise for September’s reading could trigger a sharp EUR/GBP exchange rate rise.

    Sticking with the trend, US inflation rate figures are out this week. September’s stats could cause the US dollar to fall against the pound if they show an as-expected slowdown.

    Further ahead, the US dollar could advance on news of rising retail sales next week, along with Federal Reserve minutes that point to multiple interest rate hikes in 2019.

     

    At Currencies Direct we’re here to talk currency whenever you need us, so get in touch if you want to know more about the latest news or how it could impact your currency transfers.

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    For further information contact Gaynor on 0034 673 659 580, email Gaynor.p@currenciesdirect.com or click on the following link http://www.currenciesdirect.com/en/?afflno=A017671&assetid=0000108