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German Confidence Rises, but the Pound to Euro Exchange Rate Remains Strong
Published: 24 Oct at 5 PM Tags: Pound Sterling, Euro Exchange Rate, Currency Exchange, Forex, Swiss Franc Exchange Rate, Euro Crisis, Exchange Rates, Economy, Spain, France, Pound Euro Exchaneg Rate,
If you deal with the Pound to Euro exchange rate on a regular basis (when paying a foreign mortgage or transferring wages, for example) you’ve probably been taking a keen interest in the recent run of less-than-impressive economic reports to come out of Germany.
Your foreign commitments might be in Spain or France, but as Germany is the largest economy in the currency bloc, anything which impacts the nation affects the Eurozone as a whole and takes a toll on the exchange rate of the Euro. Since the onset of the global economic crisis, Germany has been the Eurozone’s powerhouse and played an instrumental part in the currency bloc avoiding total economic collapse. However, after years of keeping its head above water, Germany has started to sink and there are many who fear that the country could enter a technical recession in the near future.
With employment, manufacturing and confidence reports from the nation all falling short over the past few months, investors have been spooked and the Euro has come under pressure. However, the Euro continued trading in a weaker position on Friday even after the release of a positive German ecostat. The German GfK Consumer Confidence index came in at 8.5 rather than the 8 expected, but Euro gains were limited amid concerns that the European Central Bank’s banking stress test will reveal a weakness in the Eurozone’s financial sector.
On Sunday the ECB will announce the results from its year-long assessment of banks from within the currency bloc. It is expected that 25 of the 105 assessed institutions will fail.
In the view of industry expert Alberto Gallo; ‘The numbers are consistent with our expectations. It’s too early to say the exercise is credible. The key will be to see how much stress the strong banks will take, and how many of them will pass by a narrow margin.’
The ECB, meanwhile, noted; ‘The ECB can’t comment on speculation about the outcome of the comprehensive assessment. Any inferences drawn as to the final outcome of the exercise would be highly speculative until the results are final.’ If a great proportion of banks fail the stress test than currently anticipated, the Euro could soften across the board.
If you’ve got foreign currency exchange requirements coming up which involve the Euro, you may want to get in touch with a reputable currency broker and benefit from their expert guidance on exchange rate movements and currency trends. With the Euro exchange rate being so volatile at the moment, it may even be worth discussing the possibility of fixing a favourable exchange rate for up to two years in advance of a trade.
Your foreign commitments might be in Spain or France, but as Germany is the largest economy in the currency bloc, anything which impacts the nation affects the Eurozone as a whole and takes a toll on the exchange rate of the Euro. Since the onset of the global economic crisis, Germany has been the Eurozone’s powerhouse and played an instrumental part in the currency bloc avoiding total economic collapse. However, after years of keeping its head above water, Germany has started to sink and there are many who fear that the country could enter a technical recession in the near future.
With employment, manufacturing and confidence reports from the nation all falling short over the past few months, investors have been spooked and the Euro has come under pressure. However, the Euro continued trading in a weaker position on Friday even after the release of a positive German ecostat. The German GfK Consumer Confidence index came in at 8.5 rather than the 8 expected, but Euro gains were limited amid concerns that the European Central Bank’s banking stress test will reveal a weakness in the Eurozone’s financial sector.
On Sunday the ECB will announce the results from its year-long assessment of banks from within the currency bloc. It is expected that 25 of the 105 assessed institutions will fail.
In the view of industry expert Alberto Gallo; ‘The numbers are consistent with our expectations. It’s too early to say the exercise is credible. The key will be to see how much stress the strong banks will take, and how many of them will pass by a narrow margin.’
The ECB, meanwhile, noted; ‘The ECB can’t comment on speculation about the outcome of the comprehensive assessment. Any inferences drawn as to the final outcome of the exercise would be highly speculative until the results are final.’ If a great proportion of banks fail the stress test than currently anticipated, the Euro could soften across the board.
If you’ve got foreign currency exchange requirements coming up which involve the Euro, you may want to get in touch with a reputable currency broker and benefit from their expert guidance on exchange rate movements and currency trends. With the Euro exchange rate being so volatile at the moment, it may even be worth discussing the possibility of fixing a favourable exchange rate for up to two years in advance of a trade.
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Source: moneytransfer.co.uk