Euro to Pound Sterling Exchange Rate Rises as Eurozone Lending Figures Boost Growth Confidence

January 28, 2019 - Written by John Cameron

STORY LINK Euro to Pound Sterling Exchange Rate Rises as Eurozone Lending Figures Boost Growth Confidence

EUR/GBP Exchange Rate Increases after Positive Eurozone Lending Figures

The Euro Pound Sterling (EUR/GBP) exchange rate is up today and is currently trading around £0.8683 on the inter-bank market.

The Euro (EUR) increased against a weakening Pound (GBP) after the publication of the Eurozone’s lending figures, which increased above expectation in December, lending some support to the single currency amid increasing concerns over economic growth.

EUR managed to keep hold of its gains on GBP, despite the President of the European Central Bank, Mario Draghi, coming out with some dovish comments during his testimony today.

Draghi commented:

‘The persistence of uncertainties in particular relating to geopolitical factors and the threat of protectionism is weighing on economic sentiment.’

Pound Euro (GBP/EUR) Exchange Rate Drops as EU Unwilling to Renegotiate Brexit Deal

The GBP/EUR exchange rate, meanwhile, has been increasingly wracked by Brexit concerns as Prime Minister Theresa May rallies to gain the necessary support behind her Brexit ‘Plan B’.

Many Sterling investors are remaining apprehensive over her deal’s success during tomorrow’s parliamentary vote, with worries that if she fails to reach concessions between Ireland and the EU on the Irish backstop, the deal will be voted down by MPs.

GBP has been further weakened as the increasing unlikelihood of the EU renegotiating crucial aspects of the deal whatever the result of tomorrow’s vote.

Margaritis Schinas, a European Commission spokesman, commented today:

‘We have a unanimous EU27 position on the withdrawal agreement which reflects the common EU position. This withdrawal agreement has been agreed with the UK government, it is endorsed by leaders and is not open for renegotiation.’

EUR/GBP Exchange Rate Rises despite Eleventh Week of French Yellow Vest Protests

The Euro has had some of its gains curbed today after Friday’s publication of German economic sentiment data for January, which showed an overall downturn of confidence in Eurozone growth into the New Year.

EUR investors, however, have remained somewhat cautious as French Yellow Vests protests once again erupted over the weekend – now in their eleventh week – and this has continued to cause concern as the Eurozone is shaken by political upheavals.

With mounting concerns over the Eurozone economy last week, investors have remained apprehensive ahead of the UK Brexit vote tomorrow, with any signs that Theresa May’s deal will be rejected heightening the possibility of the UK leaving the EU without a deal.

EUR/GBP Outlook: UK Brexit Vote in Spotlight

Both EUR and GBP investors will be looking ahead to tomorrow’s UK Parliament vote on Theresa May’s Brexit ‘Plan B’, with any signs that MPs will reject the deal likely to see the EUR/GBP exchange rate rise.

EUR traders will also be looking ahead to tomorrow’s publication of the Italian PPI figures for December, with any signs of an increase boosting confidence in the single currency.

Looking ahead to Wednesday, EUR could be provided with some uplift if Germany’s Gfk consumer confidence figures for February show any signs of increasing.

Wednesday will also see the publication of the UK mortgage approval figures for December, which are expected to decrease, potentially weakening the GBP/EUR exchange rate.

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 Daily Currency Updates Euro Forecasts