The Euro to Pound Sterling (EUR/GBP) exchange rate was little changed on Monday as a lack of market moving data releases out of the Eurozone and Great Britain combined with jitters over the Greek situation and the upcoming UK general election restrained both currencies.
The Euro to Pound Sterling (EUR/GBP) Exchange Rate Was Trading In the Region Of 0.7165
Eurozone finance ministers are growing increasingly frustrated that Greece has not delivered new economic reform plans and patience is wearing thin. If Athens does not deliver suitable reforms soon then the nation could run out of money by the end of the month.
‘Our goal is to keep Greece in the Euro. That’s what we are working for intensively. But we have to make it clear once more that the ball is in Greece’s court. We’re waiting for proposals and have been for weeks. It’s frustrating but we are patient,’ said Martin Jaeger from the German Finance Ministry.
In an attempt to improve its chances of reaching a deal, the Greek government reshuffled the line-up of its bailout negotiation team after they failed to reach a deal in Riga last Friday. Euro group finance ministers reportedly hurled abuse at their Greek counterpart Yanis Varoufakis.
‘There’s a bit of concern and that’s why you’ve seen the Euro come off. It’s just back and forth, but the longer these negotiations become more protracted, the greater the risk,’ said the director of foreign exchange strategy at Canadian Imperial Bank of Commerce in a phone interview with Bloomberg.
Against other currencies the Euro weakened. Against the US Dollar the single currency made its first decline in three days as the markets grow concerned that Greece will fail to reach a deal with its creditors in time to avert a default.
The Euro to US Dollar (EUR/USD) Exchange Rate Slipped To a Session Low of 1.0818
Some economists believe that the Eurozone can ride out a Greek exit but others are not so sure.
‘There is much talk that Europe’s Economic and Monetary Union (EMU) and the Euro could survive a Greek default, possibly even EMU exit, relatively unscathed. But we don’t share this view. Either would be a shock and one that the market is likely to respond to by pushing the Euro down,’ said the head of G-10 strategy at Standard Bank Group PlC.
The Pound Sterling meanwhile came under pressure as a result of weaker-than-forecast total trends orders data for April which was published by the Confederation of British Industry. Also weighing upon the UK currency was the latest ‘poll of polls’, which showed that both the Labour and Conservative parties are both on 33% ahead of next week’s general election.