EUR/GBP Rate & Comments for 30th April 2010

EUR/GBP - 1.154

Sterling gained against the dollar and crept back against the euro as European officials stated that additional aid for Greece would be agreed soon. Sterling is trading at $1.5360/ £1 and 11.1560/£1. The prospect of an agreement on Greek aid helped stabilise market fears over debt default in the euro region. Polls soon after last night’s final prime ministerial debate saw David Cameron emerge as the ‘winner’ of the debate, but concerns remain over a hung parliament as none of the parties have a clear majority. A poll of economists showed a 60% probability of a hung parliament – much higher than a month ago. Also yesterday, a Nationwide house price survey showed prices rise by 1.0%, which was slightly higher than expected. Yet again there is no data out today in the UK, but the pound is still likely to trade on sentiment in the final few days of campaigning. Get in touch now for a live price.

In the Euro zone, talks between the European Union and the IMF continued yesterday with Greece being primed for another multi-billion dollar ‘austerity package’. Worries over Greece have been spilling over to concerns over Spain, Portugal and Ireland and this has caused investors to sell the euro against other currencies. The euro hit 1.3225/$1 as risk aversion continued to drive a flight of funds into US dollars. On a relatively positive note, German unemployment fell by 68,000 on the previous month which was much better than expected. However, this had little or no effect on the negative sentiment caused by the debt crisis. Out today, there is European unemployment data. Call in today for a price – especially if you are holding euros, as the euro looks likely to weaken.

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