Euro to Pound Sterling (EUR/GBP) Exchange Rate Supported as European Commission Approves Greek Measures
Today’s final inflation figures for the Eurozone had little impact on EUR/GBP trading.
The report confirmed that the pace of inflation in the currency bloc fell by -1.6% on the month in January, taking the annual non-core measure to -0.6%.
However, the Euro was able to post a very modest gain against Sterling after it was announced that the European Commission has endorsed the economic reforms presented by Greece.
According to one analyst, the list ‘ticks a few important boxes particularly regarding pension reform, fiscally neutral reforms and independence of the public revenue secretariat. That said, the problem in our view was always going to be implementation of specific reforms and the ability of this government to close a review.’
Draghi’s speech in Frankfurt could inspire additional EUR/GBP movement before the close of the European session.
As it stands, the Euro to Pound Sterling (EUR/GBP) exchange rate is trading in the region of 0.7340
Earlier…
The Euro to Pound Sterling (EUR/GBP) exchange rate could tumble beyond its current 7-year low if today’s CPI report shows a further slowing of inflation in the Eurozone.
Euro to Pound Sterling (EUR/GBP) Exchange Rate Trending Lower, Eurogroup considers Greek Proposal
Although German growth data printed fairly positively on Tuesday, the Euro to Pound Sterling (EUR/GBP) exchange rate remained trading in the region of a seven-year low as attention was firmly focused on Greece.
The Euro to Pound Sterling (EUR/GBP) exchange rate hit a low of 0.7323
The Hellenic nation has presented a package of reforms to its creditors with the hope that they will be accepted and Greece granted a four-month extension of its bailout programme.
The list is currently under discussion, with its suitability being decided via conference call later today.
Dutch Finance Minister and President of the Eurogroup Jeroen Dijsselbloem stated yesterday; ‘I am very confident. The Greek government has been very serious, working very hard the last couple of days. We need it to be strong enough to work on the next couple of months. I am always optimistic.’
This morning German growth data showed a surge in domestic spending and trade in the fourth quarter of 2014. GDP increased 0.7% in the three months through December (as initially estimated) thanks to a 1.3% climb in exports and a 1.2% increase in capital expenditure.
While the data was fairly positive, the report had little impact on demand for the Euro with the Greek situation still dominating market movement.
Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast
The Eurozone’s final consumer price index for January is set for release at 10:00 GMT. Economists have forecast a month-on-month figure of -1.6% and an annual number of -0.6%.
If the data prints below these levels, indicating that the currency bloc’s deflationary spiral is worsening, the Euro could come under additional pressure.
The Euro to Pound Sterling (EUR/GBP) exchange rate hit a high of 0.7343
Economists with an interest in the Euro to Pound Sterling (EUR/GBP) currency pair will also be focusing on Bank of England (BoE) Governor Mark Carney’s testimony to the Treasury Committee.
If Carney implies that the rate of UK inflation may overshoot the central bank’s 2% target by the end of next year if interest rates aren’t increased, the Pound will most likely climb against its most traded currency counterparts.
European Central Bank President Mario Draghi is also due to speak in Frankfurt today.
The tone adopted by the central bank chief could be a driving force behind the direction taken by the Euro to Pound Sterling (EUR/GBP) exchange rate.
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3646
The Euro to US Dollar (EUR/USD) exchange rate was trending in the region of 1.1315
The US Dollar to Euro (USD/EUR) exchange rate was trending in the region of 0.8835
The Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7327
