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…
Over this period GBP/EUR climbed from 1.14 to 1.15, while EUR/GBP retreated from 0.87 to 0.86.
What’s been happening?
A lack of progress in US debt ceiling talks and fears over the ramifications of a US default kept the US dollar firmly in demand in latter half of May. These gains have been further reinforced by renewed Federal Reserve interest rate expectations.
In contrast, the euro has struggled to hold its ground as EUR exchange rates have been undermined by the negative correlation with the US dollar and underwhelming Eurozone data.
The pound, meanwhile, fluctuated over the past couple of weeks, before finding its feet after hotter-than-expected UK inflation figures stoked expectations the Bank of England (BoE) may need to raise interest rates above 5%.
The immediate focus for investors will be on the Eurozone’s consumer price index and latest US payrolls print. The two releases will be key in deciding whether the European Central Bank (ECB) and Fed continue to raise interest rates in June.
At the same time, could expectations the BoE will need to accelerate its monetary tightening in the coming months help to support the pound going forward?
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