What will move the Pound vs the Euro this month?

The Pound has remained in a fairly tight range over the last few days as economic data from both the UK and Eurozone has been rather negative which has meant neither currency has moved too much against each other. UK GDP has fallen during the first quarter according to the first estimate made by the Office for National Statistics.

Indeed, the data confirmed the slowest pace of growth in over 5 years and this means that the Bank of England’s potential interest rate hike may now be delayed which was previously expected to rise on 10th May.

However, there is still a clear argument in favour of raising interest rates as average earnings have now outpaced inflation and UK unemployment levels are close to their lowest levels in decades.

German Retail Sales saw a fall yesterday and as they are the leading economy in the Eurozone any negative news will often impact the value of the Euro and this saw the Euro fall from its recent strong run against the Pound with GBPEUR exchange rates returning to 1.14 on the Interbank level.

We also saw a fall in inflation in Italy yesterday and with a huge amount of economic data across Europe due in the morning as well as Eurozone Manufacturing data and the first estimate of Eurozone GDP data I think we could see a lot of movement for Sterling vs the Euro tomorrow.

Today, there are a number of public holiday across Europe so expect GBPEUR rates to remain in a tight range today with potentially a lot of movement tomorrow.

I think the main trigger point for whether Sterling will rally will come when the Bank of England meet on 10th May to discuss their latest interest rate decision. Although the chances are now much less I think even if we don’t see a rate hike I think that the tone will be very much that there will be one coming in the near future and I think this could see the Pound make improvements vs the Euro.

Having worked in the foreign exchange industry for one of the UK’s longest established currency brokers since 2003 I am confident of being able to help you save money when buying currency as well as helping you with the timing of your currency purchase.

For further information or for a free quote then contact me directly by sending me an email and I look forward to hearing from you.



EURO = 0.855

STG = 1.12

USD = 1.34



10 views0 comments