Euro Pound Exchange Rate Report – 11th October 2010
October 19, 2010 Leave a comment
The British Pound continued to fall against the Euro last week setting fresh 6-month lows on the back of weak economic data and Euro strength. Inflation remained stubbornly above the BoE’s target and it is worth noting that it’s unlikely to weaken in the near term as the recently proposed VAT increases may continue to keep inflation around the current levels, additionally unemployment claims advanced for the second straight month in September, and posted the largest increase in eight months. The Euro on the other hand is receiving support from the weakness seen in the USD; mixed economic data releases last week however, have so far not unsettled confidence in the single currency.
Quantitative easing concerns are weighing on Sterling; the recent comments by several of the central banks policy members have only served to increase speculation. Committee member Adam Posen argued for a second round of quantitative easing with support from Prime Minister David Cameron as Mr. Cameron said he would look to monetary policy to support growth alongside fiscal tightening (government budget cuts and tax rises) to reduce the deficit.
An important upcoming week of German and broader European economic indicators should dominate any event-driven moves for GBP/EUR. Key focus for Sterling will be on the BoE’s meeting minutes on Wednesday and retail sales on Thursday. For Europe, attention will go to the often market-moving German ZEW business confidence indicator on Tuesday however please see our market data section below for a more concise roundup.
Commercial rates of exchange and outstanding market knowledge will help you maximise the value of your Sterling, and with volatility persisting between GBP/EUR it would seem prudent to contact your dedicated currency broker in order to avoid any unfavourable market movements.
All these factors emphasise the importance and necessity to remain in close contact with your currency broker, as, evidently the market will remain volatile as the week progresses. The smallest change in exchange rates can lead to huge differences in transactions, so utilising the knowledge and professionalism of a currency broker can help to save you thousands of Pounds.
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.