Today there was an ECB announcement and initially the president, Mario Draghi, caused the Euro to strengthen and the Pound/Euro rate dropped. He said that the EU economy has continued to improve and faces fewer dangers, and added that downside risks have diminished. GBP/EUR dropped to €1.18 as a result of his comments. However the rate quickly recovered back up to about €1.1850 again when he added that if the EU economy started to slow, they would continue and perhaps even increase their Quantitative Easing measures, which put things back to where they were. This shows how simple comments from leaders of central banks can have an immediate impact on exchange rates.
Will the Pound/Euro rate go up or down this week?
The main thing that will affect GBP/EUR rates for the rest of the week comes tomorrow when we have UK GDP figures released at 09:30am. These are expected to show Britain's economy grew by 0.4% in the last quarter. If the actual number is higher than this, then the Pound will rise further. If it's lower, then expect the Pound to drop.
The current levels to buy Euros are close to the best they have been since the EU referendum last June and have risen by around 5% since last month. Many clients want to know if rates will continue moving higher. It's impossible to predict, but as I pointed out in my last post we have seen GBP/EUR get to these levels several times over the last 9 months however it's always dropped back away again. For this reason it's certainly worth considering fixing a rate if you need Euros in the next 6 months. Once the French elections are out of the way and Brexit negotiations begin, there is a good chance the Pound will come under pressure and exchange rates may drop back away. Given how much it's gone up since March, Euro buyers should be wary of holding out for an inch, and risk losing a yard. If you need to buy Euros then get in touch today for a free quote.