Play all audios:
The pound climbed further against the euro having soared at the beginning of the week. This morning the pound is trading against the euro at 1.1576 according to the latest Bloomberg
figures. This is a continued rise from yesterday morning's exchange rate of 1.1559. Last week saw the pound rise to ‘dizzy highs’ after the European Central Bank’s latest policy
meeting reported their minutes. This surge saw the pound break the 1.15 barrier against the euro giving the sterling its strongest position in 10 months. The UK’s unemployment has captured
the attention of economics this week. The country's unemployment rate currently lies at 4.3 per cent. According to Bloomberg, this is the lowest recorded rate in half a century.
However, David Blanchflower, a former member of the Bank of England’s interest rate panel and economic professor David Bell explained that the unemployment rate might need to drop as low as
three per cent before growth picks up any serious traction. The pair revealed: “Underemployment is more important than unemployment in explaining the weakness of wage growth in the U.K. The
U.K. is a long way from full-employment.” Reflecting on Monday’s economic status, Laura Parsons, currency analyst at TorFX, explained how the UK’s wage data has affected the pound. She said:
“The GBP/EUR exchange rate spent Monday trading in the region of an 11-month high as anticipation surrounding tomorrow’s UK wage data gave the pound a lift. “Sterling climbed across the
board on bets tomorrow’s average earnings data will show an increase in wage growth both with and without bonuses. “If the data matches forecasts GBP/EUR could push beyond €1.160 over the
course of tomorrow’s trading session. “The ZEW economic sentiment surveys for Germany and the Eurozone as a whole will also be of interest, with declining sentiment having the potential to
weaken the common currency.” Previous months have seen the pound fluctuate over Brexit uncertainly with slower consumer spending causing the GBP to dip. The weak GBP/EUR exchange rate at
the beginning of April has been linked to the UK’s poor weather. As the 'Beast from the East' swept across the country at the beginning of the month, consumer spending started to
fall. The high street closures have also had a negative impact on the pound. The disappointing retail sales released by the Bank of England in March triggered the pound to drop, citing
“some evidence of financial distress”.