Pound Euro Exchange Rate Hits 1.17 as Italian Referendum Concerns Limit EUR Demand

November 29, 2016 - Written by Minesh Chaudhari

STORY LINK Pound Euro Exchange Rate Hits 1.17 as Italian Referendum Concerns Limit EUR Demand

Pound Euro Exchange Rate Jumps amid Latest Brexit Situation

The Pound has been dominant against the Euro during trading today, having risen prodigiously due to global market concerns raising the appeal of the somewhat safe GBP.

On the UK’s part, the main headlines have been about a photographed Government document, which apparently showed notes on plans for Brexit.

While denied by the Government, key phrases from the note about likely not having single market access and possibly having trouble with Article 50 have raised concerns among some economists.

GBP EUR Exchange Rate Expected to Rise if BoE Offer Stable Outlook

Wednesday will bring two major UK announcements starting off with the early morning GfK consumer confidence figure. At the time of writing, this was expected to ‘rise’ from -3 to -1 points.

Later on, during the morning, the Bank of England (BoE) financial stability report is expected, which may trigger a GBP rally if the BoE is particularly optimistic about the future.

Moving onto Thursday, the manufacturing PMI for November is expected to be released; an unsupportive move downwards from 54.3 to 53.8 is expected on the month.

Euro Pound Demand Slumps as Eurozone Confidence Fails to Match Forecasts

The day’s Eurozone data has not facilitated a Euro rise against the Pound today, mainly due to both high-impact data sets missing forecasts.

Despite earlier optimism, the November business confidence and industrial sentiment stats, among other figures, fell on the month. More positively, the economic sentiment figure rose in line with expectations.

Elsewhere, Germany’s inflation rate figures dropped on the month, for the base and harmonised fields.

The greatest limiter on Euro gains at present has been the approaching Italian and Austrian votes, which could shatter Euro demand on December 4th depending on the outcomes.

Euro Pound Exchange Rate Forecast: Gains Possible on German Unemployment Rate Stats

The near-term for the Euro Pound exchange rate may see a considerable rise in the Euro’s appeal, though this is mainly dependent on the outcome of Wednesday morning’s November unemployment figures.

At the time of writing, a change in the number of unemployed of -3k was predicted, though the overall unemployment rate was set to remain at 6%.

In the event that this figure reduces against expectations, the Euro may well be boosted considerably against the Pound.

Other Eurozone data to watch out for will be Wednesday’s later core inflation rate flashes for November, which are set to rise on both the month and the year.

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