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Euro sterling rate

Euro sterling rate

Cyprus Euro V Sterling pound currency

The Pound has remained resilient following the surprise announcement last week that the UK economy slumped into a technical recession during the first quarter. That’s either a sign of the increased demand for the Pound as a safe haven from the crisis in the Euro-zone or it’s indicative of just how weak the Euro and the U.S Dollar are at the moment.

The UK currency has traded up to a fresh 20-month high versus the Euro

A report this morning showed that UK house prices rose in April for a second consecutive month, with values up a modest 0.1% from the previous month. The report added to the overall optimism that the UK economy will bounce back from the slump and that the figures on GDP will be revised higher anyway over the coming weeks.

However, the Bank of England May announcement in 10-days will be watched closely, as policy makers will deliberate over whether to increase stimulus measures in light of the recent contraction in growth. Sterling sellers might be well placed to take advantage of the Euro sterling rate  to protect against the Pound losing a bit of appeal over the days, or at least consider the benefits of a stop order to protect against a reversal.

If you need any further assistance about your Euro sterling rate currency or how to lock in the current hig rates please contact us for further details and please note there are no charges for sending money for our clients.

The Pound has given the Euro a battering over the past week following news that further UK central bank stimulus now seems unlikely. The Bank of England’s Monetary Policy Committee voted 8-1 in favour of maintaining its current asset purchasing target of 325 billion pounds which gave Sterling the push it needed to grow against the Euro to a fresh 19-month high of 1.2251.

UK Consumer Price Inflation grew from 3.4% to 3.5% in March which boosted the Pound but put pressure on the BoE’s target of bringing inflation down to 2.0% by the end of 2012. The unexpected rise in Consumer Price Index appeared to be a major factor in the MPC’s decision to halt QE. Sterling’s dogmatic performance last week was given further support as the Office for National Statistics announced a drop in the UK Unemployment Rate from 8.4% to 8.3%, and UK Retail Sales in March grew by an impressive 3.3% compared to an expected increase of only 1.3%.

The Euro continued to be held back by its peripheral nation states, with Spanish 10-year bond yields rising above 6.0% which raised concerns as to the ability of the newly-built firewall to contain the sovereign debt crisis. The 17-nation bloc was dealt another blow this morning as Eurozone debt reached the worst level ever at 87.2%, Greece’s debt to GDP rate was by far the weakest at a staggering 165.3%, with Italy following up with the Eurozone’s 2nd most profligate budget deficit of 120.1%.

Over the coming week Eurozone PMI’s in Manufacturing and Services are expected to drop, Italian Consumer Confidence is predicted to weaken and the German Consumer Inflation Index is forecast to fall; all of which will negatively impact the Euro sterling rate should the UK’s Gross Domestic Product show that the economy returned to growth in the first 3 months of 2012. If the ONS report reflects positively on UK GDP then it is possible that we could see Euro sterling rate push towards a 41-month high around the 1.2400 mark in the near future. However, if the report shows stagnation or worse for the UK economy, then expect the Pound to Euro exchange rate to fall back down to around 1.2000 where technical resistance levels are strong.

Euro sterling rate

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