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Pound Sterling to Euro Exchange Rate Live: GBP/EUR Trends Higher as UK Consumers Shrug off Brexit Fears

April 18, 2019 - Written by John Cameron

The Pound to Euro exchange rate edged up on Thursday, and the pairing is currently trading at an inter-bank rate of €1.1556.

UK retail sales surged in March, which likely buoyed Sterling against the single currency.

Between February and March, sales rose by 1.1%, with annual sales surging by a better-than-forecast 6.7%, the largest annual rise since October 2016.

The Office for National Statistics (ONS) revealed that the jump was thanks to a rise in sales at food stores, and non-store retailing (online shopping) as consumers shrugged off their Brexit worries.

With UK earnings rising at their fastest pace in a decade (or adjusting this figure for inflation, since 2016) this gives shoppers more disposable income.

Commenting on this, Jeremy Thompson Cook, Chief Economist at World First said:

‘These figures are surprising – a late Easter and declining credit card spending would typically mean a softer retail environment. Stronger employment and higher wages are natural drivers of higher consumer sentiment, while the effect from last year’s ‘Beast from the East’ brightens the year-on-year comparison.’

Euro (EUR) Falls as Eurozone Manufacturing in Worst Spell of Growth Since 2014

The flash Eurozone composite PMI signaled that the bloc had a lacklustre start to its second quarter of 2019, which likely weighed on the Euro (EUR).

Markit suggested that the flash figure indicates that the economy remains at its worst spell of growth since 2014.

April’s composite PMI fell from 51.6 to 51.3 according to the preliminary ‘flash’ estimate, making this reading the third-lowest since November 2014.

Commenting on the data, Chief Business Economist at IHS Markit, Chris Williamson said:

‘The Eurozone economy started the second quarter on a disappointing footing, with the flash PMI falling to one of the lowest levels seen since 2014. The data adds to worries that the economy has failed to rebound with any conviction from one-off factors that dampened activity late last year, and continues to show only very modest growth in the face of headwinds from slower global demand growth and subdued economic sentiment.

‘Manufacturing remained the key area of concern, with output continuing to contract at one of the fastest rates seen over the past six years. Forward-looking indicators showed some signs of improvement but remain in deeply negative territory to suggest that the factory malaise has further to run.

‘The persistence of the business survey weakness raises questions over the economy’s ability to grow by more than 1% in 2019.’

Pound Euro Outlook: Will Rising Eurozone Consumer Confidence Cause GBP/EUR to Fall?

Looking ahead to next Tuesday, the Euro (EUR) could edge up against Sterling (GBP) following the release of the Eurozone’s consumer confidence figure.

If consumer confidence edges up in April, showing some sign of improvement, the single currency could receive an upswing of support.

Meanwhile, reports suggest that cross-party Brexit talks are set to continue over Parliament’s Easter recess.

If talks continue to fail to reach a compromise, and there are no signs of movement on either party’s ‘red lines’, the Pound Euro (GBP/EUR) exchange rate could fall.

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