The Pound Sterling to Euro (GBP/EUR) exchange rate strengthened by around 0.22% on Tuesday morning.
Despite a heaped economic docket, the shared currency edged lower as data had minimal impact. This is due to trader focus being dominated by Greece’s fate, which rests in the balance of Eurogroup officials who are deciding whether Greece’s proposal for debt repayment is acceptable.
The Pound, meanwhile, gained versus most of its major peers despite an absence of data to provoke movement. This can be attributed to speculation that UK-based anti-austerity parties will be put off by recent events.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3657.
Yesterday…
The Pound Sterling to Euro (GBP/EUR) exchange rate gained by around 0.35% on Monday.
Although British data printed disappointingly on Monday morning, the Pound strengthened versus many of its major peers. This is as a result of improved sentiment towards the Bank of England (BoE) after recent positive data fuelled speculation that the British institution would be one of the first major central banks to hike rates.
The common currency, conversely, softened on Monday after German data failed to impress. Additional losses are as a result of fears that Greece’s programme for repaying creditors may be rejected by Eurogroup officials.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3578.
Pound Sterling (GBP) Exchange Rate Edges Higher on Rate Hike Hopes
British data printed poorly on Monday, although it hasn’t had a particularly significant impact on Sterling movement. CBI Reported Sales was forecast to drop a little from 39 to 35, but the actual result dropped to 1.
‘After a strong start to the year, retailers were disappointed by the unexpected halt in sales growth,’ said Rain Newton-Smith, director of economics at the CBI. ‘In particular, continually heavy discounting in the grocers sector seems to be weighing on activity.’
Despite Monday’s data printing poorly, on the whole UK data has been very positive of late. This bolstered speculation that the BoE will raise the benchmark interest rate before originally anticipated.
The Pound Sterling to Euro (GBP/EUR) exchange rate dropped to a low of 1.3499 today.
Euro (EUR) Exchange Rate Softens ahead of Greek Repayment Programme
German economic data printed poorly on Monday, compounding the Euro declination initiated by fears that Greece’s bailout repayment programme won’t meet with Eurogroup official’s requirements. IFO Business Climate, Current Assessment and Expectations all failed to meet with the respective market consensuses.
‘The Greeks have to do their homework now,’ said Volker Kauder, who heads Angela Merkel’s conservative party in the bundestag. ‘Then an extension of the aid programme can be approved.’
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast to Hold Gains
With geopolitical tensions in Greece dominating trader focus, the Pound Sterling to Euro (GBP/EUR) exchange rate is likely to hold gains for the remainder of Monday. GBP/EUR volatility is possible on Tuesday with finalised German growth figures due for publication.
The Pound Sterling to Euro (GBP/EUR) exchange rate climbed to a high of 1.3597 today.