GBP/EUR Forecast: Gains Predicted for Pound Euro Exchange Rate

Modified: Monday, 17 March 2014 09:44 BST - Written by John Cameron

STORY LINK GBP/EUR Forecast: Gains Predicted for Pound Euro Exchange Rate

Last week’s session saw the Euro power ahead against Pound Sterling sending the Pound euro exchange rate down below the 1.1950 level GBP/EUR.

Renewed support for the single currency during the last seven days has been driven by the European Central Bank’s surprise volte face which it delivered the week before. Europe’s reserve bank has for some time suggested that further loosening of the eurozone’s monetary policy may be required in order to avert a damaging period of deflation and consequential low growth in the region. The ECB’s bold assertion that this was no longer the case has lent the euro some sustained support against a flagging Pound.

However, the renewed support for the single currency is by no means guaranteed to persist following yesterday’s apparently emphatic result in Crimea’s referendum on rejoining Russia. Exit polls suggest that 93% of the residents of the Black Sea region expressed their desire to be governed by Moscow in the popular ballot. Policymakers in the European Union were quick to dismiss the referendum as ‘illegitimate’, but the fact remains that lawmakers in the Ukraine want to forge closer links with Brussels, while the people of Crimea, which has been a part of Ukraine since the nation’s emergence as an independent state, hold a completely divergent opinion. This frission has the potential to weaken the euro during this week’s session, with many analysts forecasting that the Pound euro exchange rate may settle back above the 1.2000 GBP/EUR threshold again as a consequence.

This morning’s whole of eurozone inflation numbers, along with tomorrow’s German ZEW survey and Friday’s Consumer Confidence print from the Euroland also have the potential to prove market-moving for the Pound euro exchange rate GBP/EUR. This morning’s CPI price rise numbers for last month are likely to be especially closely-monitored, with anything below the expected year-on-year showing of 0.8% likely to badly hurt the eurozone unit given the ECB’s more go-ahead outlook on inflation two weeks ago.

Important Pound Sterling / Euro Exchange Rates (As of: 010:00 GMT 17/03/2014)

The Pound Sterling to Australian Dollar exchange rate is trading down -0.57% at 1.83256 GBP/AUD.
The Pound Sterling to Canadian Dollar exchange rate is trading down -0.34% at 1.84019 GBP/CAD.
The Pound Sterling to Euro exchange rate is trading up +0.01% at 1.19647 GBP/EUR.
The Pound Sterling to New Zealand Dollar exchange rate is trading down -0.46% at 1.94062 GBP/NZD.
The Pound Sterling to US Dollar exchange rate is trading down -0.02% at 1.66373 GBP/USD.
The Euro to Australian Dollar exchange rate is trading down -0.57% at 1.53165 EUR/AUD.

The Euro to Canadian Dollar exchange rate is trading down -0.35% at 1.53802 EUR/CAD.
The Euro to Pound Sterling exchange rate is trading down -0.01% at 0.83579 EUR/GBP.
The Euro to New Zealand Dollar exchange rate is trading down -0.47% at 1.62196 EUR/NZD.
The Euro to US Dollar exchange rate is trading down -0.03% at 1.39054 EUR/USD.

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