Supportive German Confidence Data Pushes EUR/GBP Exchange Rate Higher
The Euro (EUR) has made a minor advance against the Pound (GBP) today, trading at €0.9074.
This is near the best exchange rate in a year and comes in the wake of supportive German economic confidence data.
Monday’s Ifo German economic sentiment figures showed rising optimism levels across the board; all results also rose above forecast levels.
Ifo President Clemens Fuest highlighted the good news shown in August’s Ifo readings, saying:
‘Business confidence in German firms has improved noticeably. The Ifo Index rose to 103.8 points in August after 101.7 points in July.
‘The companies were once again more satisfied with their current business situation. Business expectations were revised noticeably upwards.
‘In addition to a robust domestic economic situation, the truce in the [Eurozone] trade conflict with the US contributed to improved business confidence.
‘The German economy is performing robustly. Current figures point to economic growth of 0.5% in the third quarter.’
Disappointing French and Italian Confidence Stats Limit EUR/GBP Exchange Rate Gains
While the Euro (EUR) has made a small advance against the Pound (GBP) today, the most recent Eurozone economic news hasn’t been as supportive as Monday’s data.
French and Italian consumer confidence data for August has come out today, alongside an Italian business confidence reading for the same month.
Unfortunately for Euro traders, the French reading has remained at 97 points while both Italian confidence measures have fallen during August.
These results haven’t led to EUR/GBP exchange rate losses, but have still limited the latest Euro to Pound gains.
Pound to Euro (GBP/EUR) Exchange Rate Dips on Growing Brexit Concerns
The Pound’s (GBP) minor decline against the Euro (EUR) today has been caused by continued scepticism about how the UK will benefit from a no-deal Brexit.
Prime Minister Theresa May has declared that the UK can flourish after leaving the EU with no deal, but GBP/EUR losses suggest that traders aren’t convinced.
The PM is currently on a three-day trip to Africa to tout plans to invest in the continent after Brexit.
Even this effort has come under scrutiny from Brexit sceptics, however, as some believe that the UK is lagging behind other nations that are investing in Africa.
EUR/GBP Forecast: Will Euro to Pound Exchange Rate Rise Further on German Consumer Confidence?
Sticking with Eurozone (and specifically German) news, the next data release to watch out for will come on Wednesday morning.
This will be GfK’s German consumer confidence reading for September, which is currently expected to reprint at 10.6 points.
If the reading shows an unexpected increase in consumer confidence then the Euro could rise further against the Pound.
Beyond this Eurozone data, the next UK ecostats will consist of Friday morning’s GfK consumer confidence reading for August.
In a reverse of the German reading, GfK’s survey of UK consumer confidence is tipped to show a potentially GBP-damaging negative printing.