The Pound to US Dollar (GBP/USD) and Euro (GBP/EUR) exchange rates were trading in a tight range on Wednesday. The Eurozone had some good news in terms of economic data after the Eurozone Unemployment Rate fell from a positively revised 8.0% in October, to 7.9% in November. Forecasts had suggested the November reading would come in at 8.1%. The ecostat marks a 10-year low.
‘Among the Member States, the lowest unemployment rates in November 2018 were recorded in Czechia (1.9%), Germany (3.3%) and the Netherlands (3.5%). The highest unemployment rates were observed in Greece (18.6% in September2018) and Spain (14.7%). Compared with a year ago, the unemployment rate fell in all Member States except Estonia where it remained stable. The largest decreases were registered in Croatia (from 10.0% to 7.8%), Greece (from 20.8% to 18.6% between September 2017 and September 2018) and Spain (from 16.5% to 14.7%).’
Pound Exchange Rate (GBP/EUR, GBP/USD) Sensitive to UK Politics and Brexit Vote
Meanwhile, politics are taking the limelight when it comes to the Pound. The vote scheduled for the 15th of January–after previously being called off in December–could cause political upheaval with threats of a motion of no confidence from Labour leader Jeremy Corbyn should Theresa May not get her deal through.
Yesterday, MPs set a new obstacle in place for Theresa May to enact a no-deal Brexit on the back of her deal being unsuccessful. The government would now need parliamentary approval to depart the EU without a deal before being able to implement tax changes. The Pound exchange rate (GBP/USD, GBP/EUR) is expected to be very volatile in the weeks ahead as Brexit continues.
US Dollar Currency Pairs (USD/EUR, USD/GBP) Awaiting News on US/China Trade Talks
In US Dollar news, reports are flooding in that the US and China will release statements about this week’s trade talks on Thursday morning at the same time. The announcement has buoyed hopes that some progress has been reached and could increase risk appetite.
The Pound to US Dollar (GBP/USD) exchange rate is trading at 1.2732. The Pound to Euro (GBP/EUR) exchange rate is trending in the region of 1.1119.