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GBP/EUR Climbs on UK Sales, GBP/AUD Trading Lower; RBA Holds Interest Rates

February 5, 2019 8:35 am | Modified February 5, 2019 8:35 am
AUD, EUR, GBP | BY Charlie Murray

The Pound to Euro (GBP/EUR) and Pound to Australian Dollar (GBP/AUD) exchange rates could be in for some more volatility today. The GBP/EUR currency pair is currently trading around +0.22% higher, while the GBP/AUD exchange rate is around -0.50% lower.

The Pound exchange rate had another volatile session on Monday when UK construction data showed a bigger-than-forecast decline attributed to Brexit uncertainty. However, despite the fall, ¬†building work in some of the UK’s key cities has remained upbeat. Brexit continued to influence the GBP exchange rates, with Sterling experiencing a short-lived rally off the back of reports suggesting free-flow trade would be facilitated in the face of a no-deal Brexit.

US-China Trade Wars May Benefit Euro Exchange Rate

It may not be all bad news for the Euro at the moment either. While the European Central Bank (ECB) may be considering implementing new stimulus measures to boost economic growth, some are looking towards the impact of the US-China trade war. A new round of stimulus would likely dent the Euro exchange rate, but there’s the potential exports from the Eurozone could notice an upswing if the US and China don’t import from one another, which could support the EUR currency.

 

 

Today could be an interesting day for markets and the GBP/EUR and GBP/AUD exchange rates, with a number of economic developments due to take place. The British Retail Consortium’s (BRC) Like-For-Like Sales stat has printed significantly above expectations at +1.8% in January on the year. The December reading resided at -0.7%, and forecasts had only suggested a -0.2% print would be reached.

Reserve Bank of Australia (RBA) Keeps Interest Rates on Hold, While Retail Sales Slip

Meanwhile, data overnight has shown that Australian Retail Sales slipped in the fourth quarter, coming in at only 0.1% after expectations for a 0.5% gain. Additionally, the Reserve Bank of Australia (RBA) chose to perhaps unsurprisingly, keep interest rates on hold at 1.50%.

In the rest of the session, a number of Eurozone Purchasing Managers’ Indexes (PMI) will be out to give the final say on January’s productivity. UK New Car Registrations, Services PMI, Composite PMI and Eurozone Retail Sales Data will also be revealed.

The GBP/EUR exchange rate is trading at 1.1420 while the GBP/AUD exchange rate is trending at interbank levels of 1.7981.

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