GBP/EUR – 1.1610
Sterling ended last week on a largely positive note having risen for four days straight against the US dollar and made notable gains against the euro. Sterling benefited from the Monetary Policy Committee minutes released on Wednesday which showed all nine members voting against increasing quantitative easing. Sterling also received some support from Friday’s Public Sector Net Borrowing data that revealed a slight reduction in the deficit during the month of June. Furthermore, a number of key figures predict that key UK GDP data due this Thursday will show an increase in growth during the second quarter giving performance an extra boost. Looking ahead to this week, the aforementioned GDP figures are likely to have a substantial impact upon sterling strength should they differ from last week’s predictions. Outside of this, there is not a huge amount of data being released this week with the potential to impact performance. Mortgage approval data – a leading indicator of demand for housing – has the potential to have some influence when it is released on Tuesday, but the GDP data on Thursday along with on-going speculation on future monetary policy are likely to fuel market movement. Call in now to track sterling’s performance this week.
The Euro stayed fairly range bound on Friday with no data of high impact being released. Although German Chancellor Merkel gave positive vibes whilst discussing the economy in Germany and the euro-zone, it had a muted effect on the markets. Perhaps with her looking for re-election in September, it was expected that she would remain optimistic. We have a quiet day again for the euro today, but with French and Germany manufacturing PMI data on Wednesday and Germanys Business Climate survey on Thursday, any unexpected data is likely to cause volatility for the currency. There are also increasing concerns for southern state debts and additional funding requirements. Portugal, Cyprus and Greece seem to be at the top of this list and could significantly increase instability for the Eurozone. So call your trade for the latest rates and updates.
