Euro under pressure, but GBP still falls from multi-week highs
Written by Canarian Weekly Business
STAYING on top of the latest currency news can help you time your transfers more effectively, so find out what you should be looking out for, over the next couple of weeks.
Hopes that the UK government might be able to reach a withdrawal agreement with the EU, before 31st October, sent sterling soaring last week, but the currency started giving up its gains, once these expectations were dashed.
The GBP/EUR exchange rate has jumped from €1.07 to €1.10, over the last fortnight, while EUR/GBP has fallen from £0.92 to £0.90.
Meanwhile, GBP/USD strengthened from $1.20 to $1.22.
The pound staged an impressive recovery in mid-August, as PM Boris Johnson met with German Chancellor Angela Merkel, and French Premier Emmanuel Macron.
His meeting with these EU heavyweights gave rise to hopes that a solution to the Irish-backstop issue could be found, and that the UK could still leave the EU with a deal, on 31st October.
GBP/EUR gains were particularly notable, as the euro struggled in the face of European Central Bank (ECB) stimulus speculation, and Italian political uncertainty. However, over the last 24 hours, GBP/EUR has reversed some of its recent uptrend, on the news that Boris Johnson has asked the Queen to move her mid-September speech to October, effectively suspending parliament, until it will be too late to stop a no-deal Brexit.
With the 31st October deadline fast approaching, Brexit headlines continue to be the main catalyst of GBP fluctuations. If it looks as though the Oppositions’ attempts to prevent a no-deal Brexit will be thwarted, the pound could slide. Investors will also be focusing on the UK's construction, services and manufacturing PMIs. Signs of growth may lend GBP some support.
Elsewhere, Eurozone retail sales and growth data will be in focus, as will US durable-goods orders and employment figures.
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