Euro Exchange Rate Today: GBP EUR Falls On UK Inflation Data

Modified: Tuesday, 16 July 2013 12:26 BST - Written by Tim Boyer

STORY LINK Euro Exchange Rate Today: GBP EUR Falls On UK Inflation Data

Euro Exchange Rate Today: GBP EUR Falls On UK Inflation Data:

A lower than anticipated reading from this morning’s UK Consumer Price Index data for June was just about cancelled out by a highly disappointing showing from this month’s edition of the German ZEW Sentiment Index, published just half an hour after the British price rise numbers.

Analysts had been expecting that last month’s UK inflation figure would show at 3.0% - significantly up from May’s print of 2.7%. This set-up meant that when the data set showed a year-on-year increase in price rises of only 2.9%, analysts priced-in a higher percentage chance that the Bank of England may further loosen its monetary policy before the end of the year. The net result saw the Pound to Euro exchange rate tumble, sending it down to close to the 1.1500 GBP EUR threshold. However, the pair was soon moving higher once more following a highly disappointing ZEW Sentiment Survey from the eurozone’s largest economy. A print of 36.3 versus analysts’ expectations hurt the single currency, sending the Pound Euro exchange rate back up towards the middle part of the 1.1500-1.1600 GBP EUR range once more.

Elsewhere, the Australian Dollar has been the best-performing of the sixteen most-actively traded global currencies so far today. The minutes of the most recent RBA policy meeting, published during last night’s Asian session, revealed that the sharp decline in the value of the Australian Dollar during the past three months has made it less likely that the RBA will trim its cash rate from its current record low of 2.75% at next month’s meeting. The development has seen the Pound to Australian Dollar exchange rate (currency : GBP AUD) drop to as low as 1.6339 earlier.

This afternoon’s highlight comes at 1330hrs BST in the form of last month’s CPI inflation data in the US. Anything either below or above the anticipated annualised showing of 1.6% will cause investors to rapidly alter their projections regarding the likelihood that the Fed will trim the monthly USD85bn which it is currently committing to its controversial Quantitative Easing programme.

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