Pound to Euro Forecast: Rollercoaster Ride For GBP/EUR Investors

Modified: Sunday, 15 March 2015 22:23 BST - Written by John Cameron

STORY LINK Pound to Euro Forecast: Rollercoaster Ride For GBP/EUR Investors

Currency News UK Presents Our Latest Pound to Euro Forex Forecast and Analysis

Investor sentiment, as gauged by the closely-watched VIX ‘Fear Index’, has jumped following Friday afternoon’s New York opening bell.

VIX was languishing at well below the $15.50 on Thursday, but a short time ago the measure had jumped to as high as $16.40.

Euro Row Hurts GBP USD Exchange Rate

The shift out of risk-laden assets by institutional investors was driven by comments from European Commission President Jean-Claude Juncker earlier.

The highly respected European statesman described himself as ‘not satisfied with the developments in recent weeks’ in the debt talks between the eurogroup of Finance Ministers and Greece’s new hardline left-wing Syriza-led government.

Juncker Doubts Greek Intentions

Juncker went on to state that, ‘I don't think that we have made sufficient progress, but we'll try to push in the direction of a successful conclusion of the issues we have to deal with.’


However, on a more positive note, he did go on to confirm that, ‘I am totally excluding a failure, I don't want a failure. I would like Europeans to go together. This is not the time for division.’

Pound to euro: Exchange Rate Dipped on Carney Comments

Either way, the markets did not like what they heard and the Pound Sterling to euro (GBP/EUR) exchange rate spiked from an intraday low of 1.3943 to touch 1.4045 a short time ago.

The pair had been struggling during early trading thanks to comments from Bank of England (BoE) Governor Mark Carney suggested yesterday that a potent combination of a strengthening Pound and the continued depressed state of global commodity prices could ensure that the next interest rate hike from the BoE remained a long way off.

Dollar-Watchers Await Fed

Looking ahead, this week’s undoubted highlight is the midweek US Federal Reserve monetary policy announcement.

Wednesday evening’s headline statement will be closely-monitored by market-watchers for any suggestion that UK interest rates are on their way Northwards.

At the moment, futures markets are pricing-in a high likelihood that the Fed will opt to push rates higher in June following a strong run of American jobs data.

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