Trading Limited for Pound to Euro Exchange Rate
On Tuesday, the GBP/EUR exchange rate remained tight as both currencies struggled as a result of unfavorable data releases. With no change from its morning starting levels, the currency rate was trading at approximately €1.1192.
German Manufacturing Industry Influences Euro Exchange Rates
The largest economy in Europe, Germany, reported a sharp loss in industrial production of -3.1% on Monday, substantially missing predictions of a 0.7% decline. This put pressure on the euro. This resulted in the worst decline in industrial output in ten months, rekindled recessionary concerns, and decreased demand for the euro.
Concerns about the UK housing market have decreased the value of the pound.
As UK economic statistics failed to inspire confidence, the Pound likewise struggled to find traction on Tuesday. The housing market is still at risk of further deterioration despite home prices being unchanged for the first time in four months. Economists anticipate additional price drops after four straight months of falls and a record 2.4% MoM dip.
Danny Blanchflower, an economics professor at Dartmouth College, has cautioned that the Bank of England (BoE) may need to decrease interest rates. As these economies slow down quickly, he said, “You’re going to start seeing very horrible stuff arise, and the central bank and the markets are going to respond to it.” If discussions are unsuccessful, the Sterling may potentially be threatened by a future trade war.
Speeches by Central Bankers to Affect the Pound to Euro Exchange Rate
Speeches by both central banks in the future might cause changes in the Pound to Euro exchange rate. The BoE’s deputy governor for financial stability, Sir Jon Cunliffe, is scheduled to speak, although no monetary policy-related remarks are anticipated. Board member Isabel Schnabel of the European Central Bank (ECB) is scheduled to speak on Tuesday night. She took a hawkish position in her previous presentation, stating that the biggest danger for central banks is to prematurely pause rate rises. The Euro may gain if she sticks to this stance.