Euro Pound Exchange Rate Report – 10th July 2010
July 19, 2010 Leave a comment
Pound Euro Exchange Rates Report – 5th July 2010
Last week we witnessed a relatively quiet week for Sterling/Euro exchange rates with little more than a 1% movement between the high and low of the week prior to Fridays trading session. The movements did show greater volatility on Friday seeing a 1.3% drop for Sterling across the day. This movement came as a surprise to many after the Eurozones trade balance figures came out significantly worse from a prediction of 0.8bn to an actual reading of -3bn. The strength for the single currency following this was a shock and shows that the obvious doesn’t always happen in the currency markets. One of the tools best suited to this kind of scenario is a stop loss order where a minimum level can be placed in to the market protecting clients from any market downturn. Speak to your account manager today for more information on the various tools at our disposal to maximize your individual requirement.
One of the principle theories behind Fridays rally for the Euro came from comments made by the president of the Eurogroup of Eurozone finance ministers Jean-Claude Junker, when speaking about this weeks stress tests for Eurozone banks. When asked by an Austrian newspaper if he expects some banks to fail, he said: “I am not expecting any big catastrophes. “He added that the Eurozone’s single currency remains strong. “”The Euro will outlive its critics, it is not in danger,” he said.
Other news of note last week saw UK unemployment fall to 7.8% when forecasts had predicted this figure to remain at 8%. This didn’t have the impact many would have hoped for as the markets barely reacted to the news when it would have been expected to gather strength for the Pound.
The week ahead sees a host of data releases which could affect GBP/EUR exchange rates with the most important from a UK perspective likely to be on Wednesday in the form of the Bank of England minutes released at 9:30am. The main news that will be highlighted is how the 9 members of the MPC voted on the subject of the UK interest rate. Last month member Andrew Sentence surprised many by voting for a rate increase and we will learn if any other members have followed his lead. If more of the committee have backed the idea it could suggest the UK is finally ready to move up from the base rate of 0.5% which has been held since March 2009. A move like this could give Sterling back the edge over the Euro and start to make some gains come the next Interest rate decision in August.
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