The Euro to Pound Sterling (EUR/GBP) and Euro to Swiss Franc (EUR/CHF) exchange rates fell in Thursday’s European session as investors forecast a possible Greek exit (Grexit) by the end of the month following statements from Greek finance minister Yanis Varoufakis.
#Eurogroup meeting – Doorstep #GR @yanisvaroufakis on the Greek proposal http://t.co/xvSCldtBz3 pic.twitter.com/zJUxYcBjjc
— EU Council TV News (@EUCouncilTVNews) June 18, 2015
Greece Worries Weigh on Euro (EUR) Exchange Rate as Eurogroup Meeting Forecast to see No Deal Made, EUR/CHF, EUR/GBP Soften
The situation in Greece has gone from bad to worse recently and investors have accordingly been tentative as a loss of a nation from the currency bloc could be catastrophic for both the Eurozone as a whole and the Euro (EUR) exchange rate.
Wednesday saw Greek finance minister Yanis Varoufakis suggest that he didn’t think a deal between Greece and its creditors would be made at the Eurogroup meeting on Thursday. The 18th June summit has been on the calendar as a last-ditch attempt to solidify the union between the two sides as they continue to disagree on austerity measures.
When asked on Wednesday whether or not he believed a deal could be made, Varoufakis replied: ‘I do not believe so. Tomorrow we will set the scene for what we consider to be our political and moral duty, and that is to reach an agreement very, very quickly with our partners and the institutions.’
Pound Sterling (GBP) Exchange Rate Advances against other Currencies on Upbeat Wage Growth and Retail Sales Stats – GBP/EUR, GBP/CHF in Narrow Range
Meanwhile, the Pound has been going from strength to strength in the market of late as UK data spurs bets that the Bank of England (BoE) will be looking to hike interest rates in the near future.
Thursday was no exception, with UK Retail Sales remaining strong. The month of May saw Retail Sales, both including and excluding autos, rise by 0.2%, while both of the annual ecostats remained at 4.6%.
Wednesday had seen the UK’s wage growth figure rise from 2.3% to 2.7% in April on the year, much higher than the 2.5% economists had expected the Average Weekly Earnings number to reach.
Swiss Trade Surplus Jumps, SNB Keep Interest Rates Negative to Weaken Swiss Franc (CHF) Exchange Rate – CHF/GBP, CHF/EUR Climbs
Meanwhile, the Swiss trade surplus increased more than economists had forecast in May, rising from 2.66B to 3.43B rather than the 2.8B prediction.
Additionally, the Swiss National Bank (SNB) opted to keep interest rates on hold in June at -0.75%.
SNB Chief Thomas Jordan commented: ‘Negative interest rates in Switzerland make holding investments in Swiss Franc less attractive and will help to weaken the Franc over time.’
The Euro to Swiss Franc (EUR/CHF) exchange rate is trending at 1.0465.
The Euro to Pound Sterling (EUR/GBP) exchange rate is trending in the region of 0.7141.
