Pound euro exchange rate: GBP steady as UK inflation ticks higher
THE pound euro exchange rate is currently trading at €1.122, virtually unchanged from this morning’s opening levels despite the rise in inflation. The pound is trending narrowly against the Euro and the majority of its other peers this morning in the wake of the UK’s latest Consumer Price Index (CPI).
According to data published by the Office for National Statistics (ONS), the CPI figures revealed that UK price growth rose from 2.4 per cent to 2.5 per cent in July, signalling the first rise in inflation since November.
The ONS reported that the main contributions to annual inflation in July came through rail fares and computer games, while downward effects were driven by a 0.4 per cent fall in clothing and footwear prices over the last twelve months.
While a rise in inflation like this would normally have helped to stimulate demand in Sterling, today’s release appears to have had very little impact on the pound, as it continues to trade flatly against the euro.
This is likely because the prospects of the Bank of England (BoE) raising interest rates anytime in the foreseeable future are very slim, leading markets to view the rise in inflation as simply placing more pressure on UK consumers.Express. Home of the Daily and Sunday Express.express_logo
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Pound euro exchange rate: GBP steady as UK inflation ticks higher
THE pound euro exchange rate is currently trading at €1.122, virtually unchanged from this morning’s opening levels despite the rise in inflation. The pound is trending narrowly against the Euro and the majority of its other peers this morning in the wake of the UK’s latest Consumer Price Index (CPI).
By MATTHEW ANDREWS
PUBLISHED: 11:12, Wed, Aug 15, 2018 | UPDATED: 11:12, Wed, Aug 15, 2018
0
The pound euro exchange rate is currently trading at €1.122 (Image: GETTY )
According to data published by the Office for National Statistics (ONS), the CPI figures revealed that UK price growth rose from 2.4 per cent to 2.5 per cent in July, signalling the first rise in inflation since November.
The ONS reported that the main contributions to annual inflation in July came through rail fares and computer games, while downward effects were driven by a 0.4 per cent fall in clothing and footwear prices over the last twelve months.
While a rise in inflation like this would normally have helped to stimulate demand in Sterling, today’s release appears to have had very little impact on the pound, as it continues to trade flatly against the euro.
This is likely because the prospects of the Bank of England (BoE) raising interest rates anytime in the foreseeable future are very slim, leading markets to view the rise in inflation as simply placing more pressure on UK consumers.
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At the same time the euro is treading water this morning as it continues to be mired by Turkey’s ongoing currency crisis.
While the Turkish lira is now showing signs of recovery, there are still considerable concerns regarding Turkey’s long-term financial prospects as President Recep Tayyip Erdoğan continues to resist calls to raise interest rates.
This continues to weigh on the euro as investors raise concerns about the Eurozone’s level of exposure to Turkey’s financial woes.
Looking to Thursday’s session, the UK will publish its latest retail sales figures, potentially lending some support to the pound euro exchange rate in the second half of the week.
Economists currently forecast that sales growth will have rebounded in July, rising from -0.5 per cent to 0.2 per cent and possibly strengthening the pound.
Meanwhile the euro may look to hold its own on Thursday with the release of the Eurozone’s latest trade balance figures, with analysts predicting that the bloc’s trade surplus will have climbed to €18bn in June.