Euro Exchange Rate Today: GBP/EUR Dips On UK Inflation & German ZEW Numbers

September 17, 2013 - Written by Ben Hughes

STORY LINK Euro Exchange Rate Today: GBP/EUR Dips On UK Inflation & German ZEW Numbers

The Sterling Euro exchange rate (GBP EUR) has fallen back on the day thanks to a lower than expected UK inflation print and a positive set of German data. Many analysts are now predicting that GBP EUR may have done all it is going to do for the time-being.

The Pound to Euro exchange rate (GBP/EUR) is currently trading down by 0.18% at 1.1904 GBP/EUR. The Euro to Pound exchange rate is currently trading at 0.8401 EUR/GBP.

Today’s session has brought some encouraging news for the UK economy with the publication of figures from the Office of National Statistics which found that house prices in England have climbed to their highest ever level. The news came as a positive development for the UK’s coalition government which is looking to the UK’s housing sector to add fuel to Britain’s tentative recovery of the first two quarters of 2013. An extension of UK policymakers’ Help For Homes scheme, which will see government loans made available for buyers of existing housing stock at the start of next year, is likely to add additional momentum to the forward move in UK property prices.

However, the Pound has struggled to assert itself against the euro in spite of the encouraging data from the property sector, with the Pound euro exchange rate dipping to 1.1884 earlier on. The downside pressure on Sterling was triggered by the latest UK Consumer Price Index inflation figures which showed that the annualised core rate of inflation held steady at 2.0% last month. Analysts had been anticipating an increase to a year-on-year figure of 2.1%. Institutional investors inferred from this that a hike in the Bank of England base rate may be further away than had previously been anticipated.

Elsewhere, an additional factor causing selling pressure on GBP EUR was this morning’s German ZEW Survey which showed a marked increase from Augusts’ 42.0 showing to print at 49.6. The data suggests that economic participants in the eurozone’s leading economy are feeling far more bullish regarding the prospects for a continued economic recovery during the latter part of 2013. It also hints that they feel confident that the result of the forthcoming German election will not serve to derail any such recovery.

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