Currency Rates

EURO/GBP - 1.126

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Sterling had a poor day yesterday on weak data and growing concerns that the Bank of England could expand Quantitative Easing further. In addition, poor US unemployment data caused investors to move to the safe haven dollar on risk aversion. The pound dropped to a 9 month low against the US dollar and a 6 week low against the euro. Weaker than expected data showed a 5.8% drop in business investment in the 4th Quarter and added to the negative sentiment created this week by key members of the Bank of England who alluded to pumping more money into the economy. This dented hopes of an upgrade to the UK’s updated 4th Quarter GDP figures which are released this morning. There has been talk of an upgrade from 0.1% to 0.2% growth, however following yesterday’s poor data there is as much of a possibility that this figure will show that the economy shrank. There is growing concern that the UK’s recovery is faltering. A survey of house prices this morning showed that prices dropped by 1% from last month. This week has seen concerns grow over the state of the UK’s recovery and sterling has dropped considerably. There is a high risk of volatility today which could see the price of sterling move either way. Get in touch now to avoid losing out.

In the Euro zone, German unemployment data came in better than expected and the Euro zone business confidence reading increased to the highest level since October 2008. However, with concerns still growing over Greece, the data had little effect. The main market mover was US unemployment data which came in a lot worse than expected and caused the euro to drop against the US dollar as investors traded on risk aversion. European inflation data is released today, which is expected to show that prices in the region rose by 1% in the year to January. This is good for the region, but investors seem to agree that there is little chance of a rise in interest rates for some time. With a lot of data out today the euro could go either way. Call in now to ensure you buy at the right time.

Call 0808 163 0102 or +44 (0) 207 898 0541 from outside the UKor fill out our quote form: http://www.smartcurrencyexchange.com/quote.aspx