Exchange rate sterling euro forecast

Posted: REMGSM Date of post: 16.06.2017

Technical analyst Lucy Lillicrap at Associated Foreign Exchange. Consensus amongst the analyst community is that the Pound to Euro exchange rate is likely to go lower in the wake of a flare-up in domestic political uncertainty, with some now even arguing the pair could plumb 1.

The Euro has been gaining ground against most leading currencies lately and that pattern continued last week against Sterling following the election result. For technical analyst Lucy Lillicrap, the prospect of Sterling-Euro falling to 1. Granted, this target is not as bad - if you want a stronger Pound of course - than that forecast scenario presented by UBS that suggests the pair could fall to 0. But, a spot exchange rate at 1.

Lillicrap is a technical analyst and therefore levels are important to watch as they hint at where buying and selling interest is likely to reside. Often traders will enter and exit trades at pre-determined points based on their studies of previous price action.

Lillicrap believes that provided the exchange rate can hold itself above the 1. However, the analyst is overall negative on the outlook saying that should a downside breach of 1.

We saw Pound Sterling suffer a notable dip on June 8 and 9 after the UK electorate gave Theresa May a win in the General Election, but it was an unconvincing one that has seen doubts grow over the longer-term stability of the UK economy. The latest weekly FX market view from AFEX considers the implications of the UK's recent election. Concerning levels the Pound might go to, "the best playbook for the Pound under a hung parliament is the election," says analyst Viraj Patel at ING Bank.

Analysts at the Italian bank point out that during the years of the Eurozone debt crisis to the UK experienced a surge of portfolio inflows as growth was firming and the economy was perceived to be a safe haven amongst G10 countries.

This process should gain more traction now that domestic political risk premia rise even further," says UniCredit's UK economist Daniel Vernazza. As a result, UniCredit say their already bearish GBP forecasts GBP-USD at 1. Pre-election rate spreads suggested that Pound Sterling was actually looking expensive against the Euro. Both short-term and medium-term GBP's prospects appear daunting to us.

While Sterling weakness is liable to do the majority of damage to the valuation of the GBP to EUR conversion, one must not forget the Euro in all this.

exchange rate sterling euro forecast

And again, unfortunately for Sterling bulls, the picture here is one that hints at Euro strength going forward. Expectations for a notable Euro appreciation have grown as the Eurozone economy improves and analysts expect the European Central Bank to stem their stimulus programme in response.

exchange rate sterling euro forecast

Interest rate volatility fuelled by central banks exiting accommodation will be channelled towards FX. Pound Sterling was seen outperforming its major rivals in mid-week trade following comments from a key Bank of England member.

Pound Sterling Forecast | Pound Sterling Forecast - Expert opinions on foreign exchange

The weakness may not last, however, given most bank analysts see the Pound as more undervalued versus the Euro than it should be. An uncompromising technical assessment of the Pound suggests the period of stability seen against the Euro over recent weeks is transitory and some significantly lower levels could be tested.

With Brexit negotiations underway, the Pound is set to become increasingly prone to political headline risks. The news and information contained on this site is by no means investment advice. We intend to merely bring together and collate the latest views and news pertaining to the currency markets - subsequent decision making is done so independently of this website.

All quoted exchange rates are indicative. All Content by Pound Sterling Live. Data Currencies GBP Pairs EUR pairs AUD pairs USD pairs CAD pairs NZD pairs ZAR pairs. Pound to Slip towards 1.

Wednesday, 14 June The next downside target being eyed by McNamara is now around 1. The Hangover from the Hung Parliament We saw Pound Sterling suffer a notable dip on June 8 and 9 after the UK electorate gave Theresa May a win in the General Election, but it was an unconvincing one that has seen doubts grow over the longer-term stability of the UK economy.

Pound to Euro Exchange Rate Forecasts + News |

The latest weekly FX market view from AFEX considers the implications of the UK's recent election The slide in the Pound is expected to see some follow-through.

New research from UniCredit Bank also singles out the 1. In Pound to Euro exchange rate terms this equates to 1.

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