EUR set to weaken further on inflation data

Published: 31 Mar at 10 AM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, China, Germany, Japan, South Africa,

Pound Sterling

The Pound was trading above the 1.21 level against the Euro over the weekend as data showed that UK house prices made their longest run of increases in close to seven-years. The GBP/EUR softened on Monday however after German Retail sales smashed economist forecasts. Sterling could again push higher if today’s mortgage approval data comes in strongly and if Eurozone inflation data disappoints.

US Dollar

The US Dollar is close to a two-week high against the Japanese Yen and regained some ground against the Australian and New Zealand Dollars. The ‘Greenback’ is expected to experience volatility later in the session due to the release of a Chicago PMI report and a speech by Fed Chairman Janet Yellen.

The Euro

The Euro remained close to its lowest level in a month against the US Dollar but managed to firm against other peers after German retail sales data smashed forecasts. The gains are likely to be short-lived however as economists expect today’s Eurozone inflation data to weaken, increasing speculation that the ECB will introduce monetary easing measures at next week’s policy meeting.

Australian Dollar

The ‘Aussie’ softened against the US Dollar but remained supported against the Pound and other peers. Risk sentiment remained supported after Chinese premier Li Keqiang said Friday the country has policies in place to support economic growth. The remarks eased concerns over recent signs of a slowdown in the world’s second-largest economy.


New Zealand Dollar

The New Zealand Dollar is to its strongest level in 31-months against the US Dollar and is higher against the majority of its major peers even though domestic data showed a softening in business confidence.

Canadian Dollar

The Canadian Dollar was firmer against the US Dollar after it found support from the speculation over China. The currency could see volatility later in the session when the latest GDP data is released.

Japanese Yen

The Yen weakened following the release of surprisingly weak factory output data. As a result economists increased their bets that the Bank of Japan will expand its stimulus programme in order to support the world’s third largest economy.

South African Rand


The Rand edged up to its firmest level this year against the US Dollar, after stronger than expected credit growth data backed the case for more rate increases this year. Despite that the currency remains vulnerable to the country’s wide current account and budget deficits, exposing it to periods of risk aversion.



As of Monday, 31st March 2014, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.2099, GBP USD exchange rate was 1.6665, GBP AUD exchange rate was 1.7973, GBP NZD exchange rate was 1.9203, GBP CAD exchange rate was 1.8421, GBP CNY exchange rate was 10.3611, GBP JPY exchange rate was 172.0437, and GBP ZAR exchange rate was 17.5649.

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