Euro Pound Exchange Rate Report – 9th August 2010
August 9, 2010 Leave a comment
Last week was an extremely quiet week in terms of market movement on the GBP/EUR currency pair, with the market closing on Friday evening a matter of pips from where it opened the week on Monday morning. It seems that the Pound is consolidating its gains having recently made a sharp recovery from what many technical analysts, with hindsight, consider to be a sustained period where it was undervalued compared to its European counter-part.
Sterling did gain marginally early in the week but those gains were cancelled out following the publishing of this month’s PMI (Purchasing Managers Index). The release, which captures an overview of the conditions of sales and employment came out at 53.1, significantly lower than the previous figure of 54.8 and the expectation of 54.4. The most notable release of the week, the UK and Eurozone interest rate decisions also provided little to give direction to the stagnant pairing, with both the Bank of England and the European Central Bank keeping rates on hold at 0.5% and 1% respectively.
Looking to this week, focus will turn early in the week to German and UK trade balance figures to be released on Monday and Tuesday respectively with comparatively better figures from either expected to benefit either Sterling or the Euro. Another release to watch closely will be Wednesdays UK unemployment figures with any announcement that the workforce is growing expected to further boost the Pound.
While keeping a close eye on all these releases can be difficult for those who do not work in the markets everyday, some data is of particular significance and the potential effects should not be ignored. On Friday we have the Release of Euro GDP, (Gross Domestic Product is a measure of the total value of all goods and services produced by the Eurozone. The GDP is considered as a broad measure of the Eurozone economic activity and health. A rising trend has a positive effect on the EUR, while a falling trend is seen as negative.)
Given the potential volatility that these figures could cause in either direction, staying in touch with your currency broker, who can keep you up to date with the latest estimates and help you to determine the likely outcomes based on this to ensure that you make the most informed decision possible when securing your exchange rate, will be crucial.
Those with a requirement to buy or sell Euros would be wise to pay close attention to all data releases that could affect the cost of your purchase.
If you have yet to open a trading facility to gain access to commercial rates of exchange click here to open an exchange rate account today.