The Pound Sterling to Euro (GBP/EUR) exchange rate softened by around -0.25% on Thursday morning.
After British data showed house prices declined in January, the Pound softened versus the majority of its most traded currency rivals. Reported Sales data, due for publication later on Thursday morning, does have the potential to provoke changes, however.
The shared currency, meanwhile, edged higher versus most of its major peers on Thursday morning. This can be attributed to positive results from German unemployment data. However, many experts forecast a change to the downturn for the Euro with German inflation data due later on Thursday afternoon. Given that oil prices have softened considerably, and with most major economies struggling against low inflation, the German data is likely to print poorly.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3374.
Previously…
The Pound Sterling to Euro (GBP/EUR) exchange rate dived by around -0.30% on Tuesday morning.
After British growth failed to meet with the market consensus, the Pound softened versus the majority of its most traded currency competitors. This eases pressure on the Bank of England (BoE) to normalise monetary policy in the near-future.
When the anti-austerity party Syriza gained office in Greece, anxieties mounted regarding likelihood of Greece forcing an exit from the Eurozone which caused the common currency to soften considerably. However, those fears are now seen as unwarranted as a coalition government is less likely to agree on such a significant policy change.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3370.
Pound (GBP) Exchange Rate Trending Lower on UK GDP
Tuesday’s British economic data printed disappointingly, causing the Pound to soften versus the majority of its most traded rivals. Year-on-year Gross Domestic Product was forecast to strengthen from 2.6% to 2.8%, but the actual result only reached 2.7%. On a quarterly basis, UK GDP declined beyond the median market forecast of a drop from 0.7% to 0.6%, with the actual result falling to 0.5%.
Additionally, Loans for House Purchase data declined beyond the market consensus of a drop from 36657 to 36500, with the actual data falling to 35667. November’s Index of services data also softened beyond expectations.
The Pound Sterling to Euro (GBP/EUR) exchange rate has fallen to a low today of 1.3310.
Euro (EUR) Exchange Rate Gains on Grexit Relief
As described above, the shared currency recovered some of its losses after the anxieties regarding the potential Grexit were deemed unjustified. ‘The market is treating Syriza’s win as an anti-austerity movement more than an anti-Euro movement,’ stated strategist Sireen Harajli.
‘They (Syriza) don’t seem to have what I’d view as a far-left goal — it’s not like they’re going to come out and default on all their debt,’ said Matt Derr, a foreign-exchange strategist. ‘The Euro is getting a bit of a relief rally.’
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast to Hold Losses
Given that there is a complete absence of domestic data to provoke changes, and with market sentiment towards the Euro improving, the Pound Sterling to Euro (GBP/EUR) exchange rate is likely to hold losses for the remainder of Tuesday.
The Pound Sterling to Euro (GBP/EUR) exchange rate has climbed to a high today of 1.3446.
