The Euro weakened against the Pound for the first time in four days after the Bank of England boosted its growth estimations for the UK economy in its quarterly inflation report. The rise follows on from the Pounds rise after the dismal GDP data released by the Eurozone.
Sterling strengthened against all but one of its major counterparts after BOE governor Sir Mervyn King, who was presenting his final report before being replaced by current Bank of Canada governor Mark Carney said that recovery for the UK economy is in sight. The UK currency was also supported by economic data that showed the unemployment rate in the UK fell to 7.8% from 7.9%.
“The Pound is reacting to the headlines on slightly higher growth and lower inflation forecasts from the Bank of England,” said Gavin Friend a currency strategist at National Australia Bank Ltd. in London. “It fits with the run of U.K. data we’ve had recently. There’s a sense that some of the worst is over, but the economy is still flat lining.”
The Bank raised its forecast for expansion saying that the UK economy should grow by 0.5% this quarter, up from the previous prediction of 0.3%.
“Of most significance today is that there is a welcome change in the economic outlook,” King said at a press conference in London “This hasn’t been a typical recession, and it won’t be a typical recovery.”
The Eurozone meanwhile continues to sink deeper into recession with the Netherlands, Spain, France, Italy and many others all posting contractions to their GDP. Germany meanwhile, the region’s largest economy just managed to avoid recession as it squeezed out 0.1% growth in the first quarter of 2013.
Current Euro (EUR) Exchange Rates
The Euro/US Dollar Exchange Rate is currently in the region of: 1.2865
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8455
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.3036
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.5695
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7747
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1802
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7651
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6348
(Correct as of 12:25pm GMT)