EUR/GBP Rate & Comments for 17th August 2010

EUR/GBP - 1.216

Sterling reclaimed some of the ground lost against the US dollar last week, rising 0.4% yesterday to hit $1.5665/£1 after risk sentiment improved in trading yesterday. Against the euro, sterling slipped after house price data showed that the housing market had faltered in the last month. Data from Rightmove showed that prices slipped by 1.7% against an expected gain of 0.6%. This saw sterling drop by 0.4% against the euro as additional positive data added to the single currency. Aside from the house price data, it was a relatively quiet day for sterling. However, there is key inflation data out today and retail sales data released later in the week with the most important release being Wednesday’s Bank of England minutes likely to cause the most market movement. What most investors are looking for is whether any of the Monetary Policy Committee members joined Andrew Sentance in voting for an interest rate rise, as he did last month. Call in and speak to a trader to ensure you protect yourself from the markets moving against you.

In the Euro zone, sentiment towards the region improved yesterday and risk appetite improved after the European Central Bank revealed that it had bought minimal government bonds from the region last week. This encouraged financial markets, as it shows that there is a demand for European government bonds despite serious concerns over the ability of many governments to repay debt. As a result, the euro experienced higher demand as investors looked for riskier assets to invest in. In terms of data, inflation data came in as expected at 1.7%. Out today, there is economic sentiment data for the region which could see a surprise jump upwards after the last month. As always, get in touch to avoid missing out.

Exchange rates change every second - call Smart Currency Exchange for a live up-to-the-minute quote. For individual requirements, visit the SmartCurrencyExchange.com website and for companies visit the SmartCurrencyBusiness.com website.

EUR/GBP Rate & Comments for 11th June 2010

EUR/GBP - 1.213

Sterling rose yesterday driven by a stock market rally and the fact that many investors felt that poor sentiment surrounding the UK’s record deficit had already been ‘priced in’ – i.e. the price takes into account the deficit. The pound rose to a high of $1.4667/£1 and hit 1.2147/ £1 against the euro as investors bought back into the pound following poor sentiment earlier in the week over a possible downgrade of the country’s AAA credit rating. The Bank of England kept interest rates on hold for the 15th month running and also kept the Asset Purchase Facility (quantitative easing) on hold at £200bn. This was widely expected, and further settled the markets and helped add to the pound’s strength. In terms of data, there was little out aside from the Bank decision and out today we have manufacturing data which is expected to show a decline. There is however still concerns over the budget on 22nd June which is holding the pound back. Get in touch now to ensure you are set up to deal with any volatility that this causes.

In the Euro zone, French industrial production fell by 0.3% and the European Central Bank kept interest rates on hold at 1.0%. The euro strengthened following the press conference, as ECB President Jean-Claude Trichet made clear that the recent purchase of Government bonds by the emergency fund would not have any bearing on the ECB’s monetary policy. The sentiment towards the region is still very poor and many analysts are forecasting 1.25/£1. Get in touch now for a live exchange rate – especially if you are holding euros or will need to move euros into sterling at some point soon.

Exchange rates change every second - call Smart Currency Exchange for a live up-to-the-minute quote. For individual requirements, visit the SmartCurrencyExchange.com website and for companies visit the SmartCurrencyBusiness.com website.