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GBP/EUR exchange rates cannon upwards to three month highs following Draghi’s speech (Joshua Privett)
GBP/EUR exchange rates have moved up to three month highs this morning as a result of the speech given by Mario Draghi, the President of the European Central Bank, at 10am GMT.
He gave further hints to continued financial stimulus being required for the Eurozone recovery to move forward more confidently. Originally the deadline for this ending was September 2016, which now seems likely to be extended.
This allowed GBP/EUR to hit 1.42 very briefly as confidence fell and the Euro lost around half a Cent’s value.
Then markets corrected backwards quite violently. GBP/EUR is now lower than it first started today.
With no data released this afternoon to account for this sudden Sterling weakness or Euro strength, then standard market forces must be the cause for such rapid GBP/EUR rate movements.
Market participants have jumped at the opportunity to purchase Euros at while they are so cheap, particularly with GBP/EUR being at 1.33 less than a month ago.
Inflation hearings on Tuesday next week will also explain why the market has shifted so rapidly as many expect further Sterling weakness beginning in earnest during the third week of November.
The inflation hearings themselves are set to be held by the Treasury Committee with members of the Bank of England being grilled for answers as to why the UK economy has gotten into such dire straits in terms of inflation and what, if any, solutions can be supplied.
The fall in inflation to their lowest levels since records began was the reason why the Bank of England were recently forced to announce there would be no rise on UK interest rates until 2017 at the earliest.
This resulted in GBP/EUR falling by 3 cents off the back of the news last Thursday, so the followup-hearings as a result should echo that same Sterling weakness.
Markets have effectively signaled what the consensus is for what exchange rates may do on Tuesday by the sheer volume of those looking to use Sterling as a purchasing currency while rates are still favourable. The large purchases were clearly seen on Euros, Dollars and Australian Dollars – all of which the Pound has had a net loss against today.
Those with currency to buy should be looking to follow suit before rates take their expected tumble on Tuesday.
I strongly suggest that anyone with a GBP/EUR, GBP/USD or GBP/AUD requirement should contact me on 01494 787 478 and ask the reception for Joshua, to discuss a strategy for your upcoming transfer in order to maximise your Euro or Dollar return.
These currently favourable rates of exchange can be pegged to avoid harmful movements against your favour on a future transfer occurring.
Those looking to purchase Sterling can also contact me to discuss how to ride any positive movements in your favour next week to their conclusion within the time-frame you have to complete your transfer. [email protected]
Source: http://www.poundsterlingforecast.com/2015/11/12/gbpeur-exchange-rates-cannon-upwards-to-three-month-highs-following-draghi-speech-joshua-privett/
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