Pound to Euro Exchange Rate dips ahead of Critical EU Summit: Currency News Today

Pound to Euro Exchange Rate struggles, US Dollar strengthens on easing risk appetite

The Pound to Euro exchange rate dipped ahead of the EU leaders summit set to discuss the EU €750bn recovery fund while the ECB left monetary policy unchanged.

US Dollar exchange rates rose after market risk appetite eased, causing risk-sensitive currencies like the Australian Dollar to struggle. The New Zealand Dollar also struggled because of souring market sentiment and the Canadian Dollar lost appeal as oil prices slid.

Pound (GBP) Muted on Mixed Employment Figures, Pound to Euro Exchange Rate likely to drop

The Pound (GBP) was left subdued yesterday as analysts warned that the UK’s robust headline jobless figures masked the true extent of the country’s impending unemployment crisis.

Further limiting the appeal of Sterling were the accompanying earning figures, which showed wage growth contracted for the first time in six years in May.

Looking ahead, the Pound may face additional pressure through today’s session. The focus turns back to Brexit with the conclusion of the latest round of talks which will likely weigh on the Pound to Euro exchange rate.

Euro to Pound (EUR) Rises as ECB in ‘Wait and See Mode’

The Euro (EUR) remained steady through Thursday’s trading session in response to the European Central Bank’s (ECB) latest policy decision.

As widely expected, the ECB chose to leave its monetary policy untouched this month, with the bank seemingly content to stay pat as it waits for more concrete information on how its current stimulus measures are impacting the Eurozone economy.

Furthermore, like most EUR investors the ECB also appears to be waiting for the outcome of today’s EU summit. The Pound to Euro Exchange rate has dipped through the week in optimistic anticipation. Will leaders be able to persuade the so-called ‘frugal four’ to back the EU’s €750bn coronavirus recovery package?

US Dollar (USD) Firms on Easing Risk Appetite

The US Dollar (USD) edged higher yesterday, with demand for the safe-haven ‘Greenback’ creeping higher once more amidst a more cautious mood in markets.

Further buoying USD exchange rates was the latest US economic data with June’s retail sales figures and July’s Philadelphia manufacturing index both printing above expectations.

Coming up, we may see the US Dollar extend these gains later this afternoon if Michigan University’s latest US consumer sentiment index rose in line with expectations this month.

Canadian Dollar (CAD) Undermined by Sliding Oil Prices

The Canadian Dollar (CAD) was left on the back foot on Thursday, with the appeal of the commodity-linked ‘Loonie’ being dented by a slide in oil prices.

Australian Dollar (AUD) Struggles amidst US-China Tensions

The Australian Dollar (AUD) was left on the back foot overnight on Thursday, with rising tensions between the US and China limiting demand for the risk-sensitive ‘Aussie’.

New Zealand Dollar (NZD) Muted in Risk-Off Trade

The New Zealand Dollar (NZD) also faced headwinds in overnight trade, with investors steering clear of the ‘Kiwi’ as risk sentiment continued to weaken.

Matthew Andrews

Contact Matthew Andrews