Monday, 1 June 2015

UK data disappoints, pulling GBP/EUR rates under €1.40

Last week we saw the Pound/Euro rates above the key €1.40 level, however as with the other 4 or 5 times that’s happened this year, the high rate was not to last, and at the end of last week, poor UK data weakened Sterling, and pulled rates back into the €1.39’s:


Why has the Pound fallen against the Euro? 


On the one hand, it looks increasingly likely that Greece will be able to meet its upcoming debt payments. My view is they are simply trying to negotiate a better deal, hence the delays. This expectation is giving some strength back to the Euro making it more expensive to buy. 

On the other hand, the Pound is coming under pressure due to a poor run of economic data. Investors are starting to worry about the implications of the UK leaving the EU, and this uncertainty is stopping investment and weakening the Pound. Prime Minister David Cameron's introduced a law last week that will guarantee the EU referendum will be held by the end of 2017. 

Also last week we saw other poor data, such as slightly weaker than expected growth figures. This coupled with other data signals that interest rates in the UK aren’t likely to rise until well into 2016. 

Which way will exchange rates move this week? 


Below I’ve listed the main data releases that I think will affect Pound/Euro rates, and exchange rates for other major currencies. Of course any further developments with the Greek situation are also likely to affect rates. 

If you are looking for the best exchange rates, then click here to send a free enquiry about the rates and service I can offer you, which are up to 5% better than available at banks. 

This week’s economic data releases 


Monday 1st June 2015 – This morning we have already seen manufacturing figures for the UK that were worse than expected that weakened the Pound slightly. We have also seen a raft of US data, most of which was better than analyst forecasts, which has strengthened the US Dollar and taken GBP/USD rates to around $1.52. 

Tuesday 2nd June 2015 – Today we have UK Mortgage numbers, construction figures, and credit data, all of which could affect the value of the Pound. In Europe, a raft of inflation data is a very important release for those watching Pound/Euro rates, as it could affect how much money the EU pump into the economy through their QE programme. 

Wednesday 3rd June 2015 – today’s main release is the latest EU decision on interest rates. While no change is expected, the comments made in the press conference at 13:30pm could really affect the Euro, especially so if they make changes to their QE expectations. 

Thursday 4th June 2015 – Today is the UK’s turn for interest rates, and as with the EU, no change is expected. Any comments made by the Bank of England governor Mark Carney however could well affect Sterling. 

Friday 5th June 2015 – Today is jobs day in the USA, and there are lots of employment figures including the Non-Farm payrolls numbers. This release in particular often causes large swings in the GBP/USD rate as it’s so hard to forecast. In Europe today, the latest GDP figures could affect Pound/Euro rates. 

Getting the best exchange rates 


Rates are very volatile at the moment, moving very quickly. In order to get the best possible rates you need to have a good currency broker who can monitor the market for you, explain the options you can consider on when to fix a rate, and get you a much better rate than banks will offer. The worst thing you can do is just watch the rate and hope it will move your way, or use the bank to convert your funds. 

Why not give me a try? The rates and service I provide are exceptional, and with over 10 years’ experience helping personal and business customers with their currency requirements, it may be prudent to see if I can do the same for you. Send me a free no obligation enquiry today by clicking below.