- Pound (GBP) rises modestly after gains last week
- UK house price data shows prices falling
- Euro (EUR) is falling, extending last week’s losses
- EZ PMI data is due this week
The Pound-Euro (GBP/EUR) exchange rate is rising modestly. The pair rose 0.27% in the previous week, settling on Friday at €1.1586. It traded between €1.1525 and €1.1642. At 15:15 GBP/EUR trades +0.05% at €1.1592.
The pound is pretty unchanged at the start of the week as investors weigh up the latest house price data and look ahead to inflation figures as well as the speech by Bank of England governor Bailey later this week.
Data from the property website Rightmove showed that home prices fell in the four weeks to mid-August by 1.3% compared to the previous four weeks, in line with normal patterns in Midsummer. In annual terms. Prices had fallen sharply in the previous 4-week period.
Meanwhile, the number of homes up for sale grew by more than expected, keeping volumes of home sales at a decade high.
This month’s interest rate reduction by the Bank of England, its fifth since August last year, is unlikely to pull mortgage costs down further but may encourage some buying.
Looking ahead, UK CPI data, due on Wednesday, is expected to show that inflation remains above the central bank’s 2% target. Finally, Bank of England governor Andrew Bailey will be speaking at the Jackson Hole symposium in the US this week.
The euro is modestly lower as investors look to a key meeting between select key officials and President Trump later today.
The meeting between the two leaders comes after Trump met with Russian President Putin in Alaska on Friday.
Trump has suggested that Ukraine give up large areas of land in the east of the country and rule out joining NATO in order to progress with peace.
Looking ahead, attention this week will be on eurozone PMI data on Thursday, which comes after GDP figures last week showed the eurozone economy grew just 0.1% quarter on quarter.