Pound v Euro Exchange Rate Strikes Fresh 7 ? Year High GBP EUR - More Forecast

March 11, 2015 - Written by John Cameron

STORY LINK Pound v Euro Exchange Rate Strikes Fresh 7 ? Year High GBP EUR - More Forecast

The Pound Sterling (currency:GBP) put in a solid performance against the other major global currencies during today’s session as investors reacted positively to comments from Bank of England (BoE) Governor Mark Carney. The Head Honcho at Threadneedle Street, who was speaking in front of a House of Lords Committee, had reassuring comments to make regarding the UK’s housing market, which many commentators fear is beginning to show signs of over-heating.

Carney’s assertion that Britain’s property market does not pose an imminent threat to domestic financial stability, came as music to the ears of investors holding Pound Sterling-denominated assets. Carney went on to reassure market participants that his Bank would remain vigilant regarding any improprieties in the UK’s complex financial markets and that this area of the BoE’s remit would remain of central importance moving forward.

The final piece of market-friendly advice from the BoE Chief saw him confirm that he sees increasing signs that British wages are starting to pick up following a long period of stagnation following the credit crisis. Carney’s comments saw the Pound soar against the euro, sending the GBP EUR exchange rate up to a fresh 7 ½ year high of 1.4095.

The sharp shift higher for the GBP EUR exchange rate was driven by the commencement of the European Central Bank’s Quantitative Easing programme yesterday and was provided with further fuel by increased tension between Greece and the eurogroup of Finance Ministers at yesterday’s Brussels meeting.

Elsewhere, the New York opening bell a short time ago saw the closely-monitored VIX ‘Fear Gauge’ spike by over 10% to touch $16.65. This represented the indicator’s highest level since 18th February, illustrating the level of nervousness amongst market participants regarding the ‘Greek Problem’. The shift out of risk-driven assets has manifested itself in pronounced losses for global stock markets which saw London’s headline FTSE 100 close down by over 2.5%, while the broad-ranging S&P 500 in the US traded down by over 1.0% during the opening stages of today’s trading. On the currency markets, the flight to quality sent the Pound Sterling higher against both the Australian Dollar (currency:AUD) and the New Zealand Dollar (currency:NZD). Further gains are forecast for these pairs moving forward.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: Currency Predictions Euro Forecasts Euro Pound Forecasts Pound Euro Forecasts