Euro to Pound: EUR/GBP Exchange Rate Weekly Roundup ? May 5 to May 8

May 10, 2015 - Written by James Fuller

STORY LINK Euro to Pound: EUR/GBP Exchange Rate Weekly Roundup ? May 5 to May 8

Euro to Pound Weekly Roundup – May 5 to May 8

As the markets were shut on May 4 for a Bank holiday, the UK’s trading week began on May 5. Despite the market being closed, the Euro was little changed in European trading as economic data came in mixed. Manufacturing PMI reports out of France and Germany came in below expectations. A Eurozone PMI however came in slightly better than forecast. Manufacturing activity across the currency bloc was shown to have eased from 52.2 to 52. However, that figure was slightly better than the 51.9 forecasted.

On Tuesday, the Euro remained under pressure from data that showed that manufacturing activity in France and Greece contracted in April. The French PMI fell from 48.8 to 48 and the Greek PMI fell from 48.9 to 46.5. Uncertainty also remains high regarding the Greece debt situation. The Euro did receive some support from the release of data which showed that Spanish unemployment fell by a larger than forecast margin. The European Commission also revised its growth expectations for the currency blog higher, but slashed them for Greece. \r\nThe Pound Sterling meanwhile advanced against the Euro as economists continued to worry about the situation in Greece and disappointing data out of France. Sterling became increasingly volatile, as Thursday’s general election got closer.

Midweek, the Euro firmed as Greece successfully paid a €200 million interest payment to the IMF. The payment eased some of the worries that the nation will default. The single currency was also supported by a stronger-than-forecast Services PMI out of Spain. The index rose to 60.3 from 57.3 in April and adds to signs that Spain’s economic recovery is gaining momentum.

The Pound Sterling regained some ground as the latest UK services PMI came in stronger than expected. The PMI rose from 58.9 to 59.5.

On Thursday, the Euro advanced to a 3-month high against the Pound and advanced to a 2-month high against the US Dollar as the UK general election and disappointing US jobs data weighed upon Sterling and the ‘Greenback’. Further gains were held in check as data out of France and Germany came in worse-than-forecast.

As the week came to a close the Euro weakened against the Pound, US Dollar and other major peers after data out of Germany showed that industrial production fell by -0.5% on a month-on-month basis and fell by -0.1% on a year-on-year basis. Further losses were restrained as Industrial production in Spain surged by 2.9% and German balance of trade came in positively.

Against the Euro, the Pound surged to its best level since 2009 as the Conservatives stunned the markets by winning a majority government. The vote saw the Liberal Democrats decimated and the Labour Party performed worse than predicted.

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