Pound euro exchange rate: gbp steady against eur on mixed gdp data

Pound euro exchange rate: gbp steady against eur on mixed gdp data

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The Office for National Statistics (ONS) has reported growth of 0.7 per cent for August’s three-month average, but a flat 0 per cent reading for August compared to 0.4 per cent growth in


July. The pound's limited movement today is perhaps because ONS analysts have stressed that the monthly figures are less accurate as they don’t factor in as much as the quarterly GDP


readings. In other UK news, the trade deficit has expanded considerably in August, while levels of construction output have fallen by more than forecast. Today’s euro to pound exchange rate


stagnation has been caused by limited Eurozone data being released, in addition to continued disagreement between Italy and the EU. Italy’s coalition government has shown no real signs of


acceding to the European Commission’s demands to rein in its budget deficit. Italy’s proposed budget has exceeded EU spending limits and with both sides refusing to budge, euro trader


confidence has steadily declined. The situation hasn’t been helped by the International Monetary Fund (IMF), with IMF officials taking sides and urging Italy’s Eurosceptic government to


comply with the EU’s requests. Indicating a desire to work through the troubling situation, Italian Finance Minister Giovanni Tria said: “Although so far there hasn’t been an explosion as


some feared, we are of course worried. “As a responsible government, we aim to explain the budget and thus guide investors in our meetings in order to calm markets.” The next economic event


that could influence Sterling demand will be Thursday’s speech from Bank of England (BoE) policymaker Gertjan Vlieghe. Mr Vlieghe is due to discuss “Global and Domestic Challenges for UK


Monetary Policy”, so he could make clear comments about BoE interest rate decisions. If Mr Vlieghe believes that the BoE can weather any Brexit-related problems and voices support for a 2019


interest rate hike, then the pound euro exchange rate could rise. For euro traders, the next major data release will be Thursday’s European Central Bank (ECB) monetary policy meeting


accounts. The accounts will reveal the decisions of policymakers at their latest meeting and these could show support for higher interest rates in the future. As with the BoE, an ECB


interest rate hike is expected in 2019; any clear signs that higher rates are incoming might be enough to boost euro demand.