The Pound Sterling to Euro exchange rate recovered from an 11-month low, whilst the Pound to Dollar conversion bounced back from a 6-year low yesterday.
As traders took advantage of the Pound’s comparatively low trade weighting, demand for Sterling (GBP) saw the British asset recover some ground versus the majors.
A positive report from Lloyds Bank, which showed business output rose in England and Wales, also supported demand for the Pound.
However, Sterling gains have been somewhat limited with the forthcoming EU referendum continuing to weigh heavily on investor sentiment.
Latest GBP-USD-EUR Exchange Rates Today
On Saturday the Euro to British Pound exchange rate (EUR/GBP) converts at 0.858
The pound conversion rate (against euro) is quoted at 1.165 EUR/GBP.
The GBP to USD exchange rate converts at 1.255 today.
Today finds the pound to australian dollar spot exchange rate priced at 1.9.
Please note: the FX rates above, updated 4th May 2024, will have a commission applied by your typical high street bank. Currency brokers specialise in these type of foreign currency transactions and can save you up to 5% on international payments compared to the banks.
Pound Sterling (GBP) Exchange Rate News: Impact from China’s Economic Woes Subsides
The British Pound recovered some ground against the majors on Monday, rising from a near 6-year low against the US Dollar; bouncing back from the weakest level in 11 months versus the Euro, as the effects of China’s economic turmoil and stock market volatility subsided.
Concerns over the lack of momentum in the UK economy, persistently low inflation and uncertainty over the EU referendum has prompted a significant slide in the value of the British Pound since the beginning of the year.
Sterling has hit lows under 1.44 against the US Dollar, the lowest levels seen since 2010, while the UK currency also touched a low of 1.3250 versus the Euro in overnight trading on Monday, before bouncing back to a high above 1.34 through the day.
Pound Predicted to Weaken with BoE Likely to Hold Rates at 0.50%
Investors are now forecasting that the BoE will leave interest rates unchanged at 0.5% until 2017 and we could see further Sterling weakness with the market yet to fully price that in to current projections.
The brief relief for the Pound ended last night, as European stocks erased an earlier advance and the safe haven demand of the single currency also prompted gains towards 1.09 on EUR/USD.
Despite the well documented problems in the Euro-zone over the past 12 months with credit issues in Greece and other nations and the aggressive quantitative easing strategy implemented by the European Central Bank, the Euro seems to gain ground amid downside volatility in global equity markets, along with the Yen.
GBP/EUR, GBP/USD Exchange Rate Forecast: Pound Vulnerable to Swings in Market Sentiment
That may be because extreme volatility, particularly in China, has prompted warnings from investors like George Soros that we could be heading towards another financial crisis similar to that in 2008 and that in turn increases speculation that global central banks will refrain from tightening monetary policy.
As recently as July 2015, the market had been speculating that the Bank of England could raise interest rates before the turn of the year and yet we’re in January and the latest projections are for rates to remain on hold for another 12 months at least.
Sterling seems incredibly vulnerable at present to swings in risk sentiment. Basically put, Sterling gains and falls in line with the stock market and a stabilization could prompt a recovery. However, should UK news provide cause for concern any Sterling gains are likely to prove short lived. The BoE's interest rate decision is due out on Thursday but if the central bank took any action at this juncture it would come as a massive surprise.
Data Released 12th January
U.K 09:30 Industrial Output (November)
- Manufacturing
U.S 11:00 NFIB Small Business Optimism (December)