While the Euro broadly strengthened in the aftermath of better-than-forecast PMI reports for the Eurozone, Germany, Italy and France, the common currency ended the local session lower against the Pound.
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8275 <
Sterling stormed ahead of its European cousin as yesterday’s UK manufacturing PMI highlighted the economic disparity between Britain and the 17-nation currency bloc.
As currency strategist Lee Hardman noted; ‘The report reinforces the recent strong buy momentum for the pound. The report is consistent with the robust pace of economic recovery continuing in the final quarter of this year. That’s a supportive factor for the pound with the U.K. economy outperforming the other major economies.’
In recent months UK reports have outstripped expectations, pointing to a more established economic recovery than expected. Earlier in the year the British central bank took the unprecedented step of tying interest rate increases to the unemployment rate, intimating that interest rates would only be raised from record lows once the unemployment rate had fallen to at least 7 per cent.
As the UK jobless rate appears to be falling faster than anyone expected, the Bank of England may need to revise its stance.
With both the European Central Bank and the BoE scheduled to deliver their rate decisions this week (and perhaps provide guidance regarding future policy changes) European data releases are of particular interest.
Although the Eurozone’s producer price index may impact the Euro, UK construction PMI is likely to be the main driver of EUR/GBP movement as the day progresses.
Economists have forecast that the measure of UK construction dipped from 59.4 to 59.0 in November but if the figure surprises to the upside the Pound could extend gains.
Eurozone producer prices are expected to fall by 0.2 per cent month-on-month.
Euro (EUR) Exchange Rates
As of 07:05 am GMT
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3543 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8275 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4937 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6534 <
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.4416 >
