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Latest currency news

GBP exchange rates have been muted in recent weeks amid rising Covid cases and a slowing economic recovery.

GBP/EUR fluctuated between €1.17 and €1.16, bouncing off a six-week low, while EUR/GBP ranged by about half a penny, just shy of £0.86.

GBP/USD has climbed from $1.36 to $1.39, while EUR/USD rose from $1.17 to $1.19.

What’s been happening?

The pound has faced headwinds in recent weeks as UK Covid cases continue to rise and the UK struggles amid a supply chain crisis, both of which are affecting the UK’s economic recovery. However, sterling has showed surprising resilience.

Mixed data has caused turbulence for the euro, with some bumps in the road for the Eurozone’s economic recovery, particularly in Germany.

Meanwhile, an increased appetite for risk and hesitancy from the Federal Reserve over tightening monetary policy have seen the safe-haven US dollar drop to monthly lows.

What do you need to look out for?

UK inflation is currently forecast to jump to 2.7% in the next CPI reading, which may boost the pound by piling pressure on the Bank of England to act.

With inflation hitting a ten-year high of 3%, EUR investors will be looking to see how the European Central Bank (ECB) responds in September’s policy decision.

The Fed disappointed investors by keeping quiet about a potential tapering timeline, but any updates in the coming weeks could cause a lot of movement in USD.

 

Our friends at Currencies Direct

At Currencies Direct we’re here to talk currency whenever you need us, so get in touch if you want to know more about the latest news or how it could impact your currency transfers.

Since 1996 we’ve helped more than 250,000 customers with their currency transfers, just pop into your local Currencies Direct branch or give us a call to find out more.

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