Sterling Update: EUR slips

 
Sterling Update: EUR slips

Here’s the latest currency news from our partner Moneycorp, to help you find out what your money is worth.

GBP

GBP/USD hit six-month lows today after the UK Retail Sales data underwhelmed markets, coming in at -0.7% against forecasts of -0.3% and the latest Flash Manufacturing and Services PMI data, which both came in below expectations, added additional downward pressure to the pound. This follows Wednesday’s CPI data, which rose ahead of expectation from 0.1% to 0.6% month-on-month, and from 1.7% to 2.3% year-on-year, and last Friday’s estimated Q3 GDP growth for the UK came in at 0.1%, down from 0.5% in the second quarter, below the anticipated 0.2%. The Q3 figure indicates that the UK’s economic growth is almost at a standstill.

Economists have suggested that the Labour government’s messaging on the economy, tax hikes, and increased borrowing have contributed to declining business and consumer confidence.

Monetary Policy Report Hearings took place on Tuesday when the Bank of England’s Governor Andrew Bailey and other MPC members testified before Parliament’s Treasury Committee on inflation and the economic outlook. Bailey appeared to forecast a slower pathway to interest rate reductions. “There are different ways in which the increase in employer National Insurance Contributions announced in the Autumn Budget could play out in the economy,” Bailey said. “A gradual approach to removing monetary policy restraint will help us to observe how this plays out, along with other risks to the inflation outlook.”

EUR

The EUR has slipped after Eurozone flash Manufacturing and Services PMIs came in below forecasts this morning, showing contraction in both industries. Markets expectations of a 50-basis point European Central Bank rate cut in December are now climbing and are currently priced in at around 50%. On Tuesday, the eurozone’s CPI YoY for October remained at 2.0%.

This followed the release of American inflation data on Wednesday when the euro also declined against the US dollar. On the same day, US Republicans won a majority in the House and gained control of Congress. The increasing likelihood of President-Elect Donald Trump’s policies being enacted has added to conversations surrounding inflation risk, which is pushing up US government bond yields and contributing to US dollar strength.

On Monday, 18 November, the Rio summit of the G20 began, aiming to build “a fair world and a sustainable planet”. Leaders of major economies will be bracing for a shift in the global order with the return to power of Donald Trump. Discussions about trade, climate change, and international security may clash with the president-elect’s promised policy changes, including the threat of US tariffs.

Why Moneycorp?

With a Platinum Trusted Service Award 2020 from independent review site Feefo and 40 years of experience in the industry, FrenchEntrée has been recommending Moneycorp for more than 15 years. During this time they have helped thousands of client planning the best way to pay for their property as well as supporting them afterwards with any further payment from paying bills, mortgages to repatriating UK pension payments for those who have retired to France.

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Furthermore, we have worked with the same person at Moneycorp for more than a decade! You might be familiar with her as she often writes for our French Property News magazine. She has 13 years’ experience in foreign exchange, and is a qualified European lawyer with experience in European transactions. Mar will be happy to answer any questions or enquiries to support you through these difficult times

Opening an account is really easy and free of cost. You can register online or over the phone in a couple of minutes and for FrenchEntrée readers there are no transfer fees in any payment.

Beware of currency risk. None of the information contained in this article constitutes, nor should be construed as financial advice. TTT Moneycorp Limited (company number 738837) is registered in England. Its registered office is at Floor 5, Zig Zag Building, 70 Victoria Street, London, SW1E 6SQ. Moneycorp is a trading name of TTT Moneycorp Limited which is authorised and regulated by the Financial Conduct Authority for the provision of payment services (firm reference number 308919).

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