{"id":11505,"date":"2019-10-15T03:00:16","date_gmt":"2019-10-15T07:00:16","guid":{"rendered":"https:\/\/currencylive.com\/?p=11505"},"modified":"2019-10-15T02:43:43","modified_gmt":"2019-10-15T06:43:43","slug":"101246-gbp-eur-pound-volatile-as-brexit-talks-continue","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\/","title":{"rendered":"GBP\/EUR: Pound Volatile As Brexit Talks Continue"},"content":{"rendered":"

British political uncertainty and better than forecast German industrial production sent the pound euro exchange rate lower on Monday, before Brexit optimism lifted the pound into the close. The pound euro exchange rate closed Monday\u2019s session at flat at \u20ac1.1435. The pair is holding those late gains in early trade on Tuesday.<\/p>\n

Brexit headlines acted as the exclusive driver of sterling on Monday. Initial scepticism that a Brexit deal would not be reached in time weighed on the pound on Monday. However, later in the session the pessimism was replaced by optimism that the two sides were actually closer to reaching an agreement than initially thought. \u00a0The conflicting reports are leaving pound investors unsure if a deal will be ready for the EU Summit later this week.<\/p>\n

 <\/p>\n\n\n\n\n
Why is a \u201csoft\u201d Brexit better for sterling than a \u201chard\u201d Brexit?<\/strong><\/td>\n<\/tr>\n
A soft Brexit implies anything less than UK\u2019s complete withdrawal from the EU. For example, it could mean the UK retains some form of membership to the European Union single market in exchange for some free movement of people, i.e. immigration. This is considered more positive than a \u201chard\u201d Brexit, which is a full severance from the EU. The reason \u201csoft\u201d is considered more pound-friendly is because the economic impact would be lower. If there is less negative impact on the economy, foreign investors will continue to invest in the UK. As investment requires local currency, this increased demand for the pound then boosts its value.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

Today, Brexit headlines will continue to drive the pound. However, pound investors will also look towards UK labour market data and an appearance by Bank of England Governor Mark Carney as he testifies before Parliament.<\/p>\n

Analysts are expecting the UK unemployment rate to remain steady at 3.8%. Meanwhile, analysts forecast that average earnings in the three months to August will hold steady at an impressive 4%. Strong figures could support the pound, although data will play second fiddle to Brexit news.<\/p>\n

 <\/p>\n\n\n\n\n
How does strong jobs data boost the currency?<\/strong><\/td>\n<\/tr>\n
It works like this, when there is low unemployment and high job creation, the demand for workers increases. As demand for workers goes up, wages for those workers also go up. Which means the workers are now taking home more money to spend on cars, houses or in the shops. As a result, demand for goods and services also increase, pushing the prices of the goods and services higher. That\u2019s also known as inflation. When inflation moves higher, central banks are more likely to raise interest rates, which then pushes the worth of the currency higher.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

Will ZEW Sentiment Figures Pull Euro Lower?<\/strong><\/h3>\n

The euro moved higher versus the pound early in the previous session, after better than expected eurozone industrial data. Industrial production increased 0.4% month on month in August. This was ahead of the 0.3% increase than analysts had pencilled in. However, production was down -2.8% compared to a year earlier. This was the tenth straight month that industrial production had fallen on an annual comparative basis.<\/p>\n

The figures will have done little to stem recession fears for the block. Following months of poor data investors have grown increasingly convinced that the eurozone is falling into recession.<\/p>\n

The euro could become vulnerable today as investors look ahead to German ZEW sentiment data for both the eurozone and for Germany. Economic sentiment has steadily declined across recent months amid growing concerns over the manufacturing slump in Germany and fears that it could spill not only across sectors but also across the eurozone. Sentiment unexpectedly bounced higher in September. However, analysts are not expecting a repeat in October.<\/p>\n

 <\/p>\n\n\n\n\n
What do these figures mean?<\/strong><\/td>\n<\/tr>\n
When measuring the value of a pair of currencies, one set equals 1 unit and the other shows the current equivalent. As the market moves, the amount will vary from minute to minute.<\/p>\n

 <\/p>\n

For example, it could be written:<\/p>\n

1 GBP = 1.13990 EUR<\/p>\n

Here, \u00a31 is equivalent to approximately \u20ac1.14. This specifically measures the pound\u2019s worth against the euro. If the euro amount increases in this pairing, it\u2019s positive for the pound<\/p>\n

.<\/p>\n

Or, if you were looking at it the other way around:<\/p>\n

1 EUR = 0.87271 GBP<\/em><\/p>\n

In this example, \u20ac1 is equivalent to approximately \u00a30.87. This measures the euro\u2019s worth versus the British pound. If the sterling number gets larger, it\u2019s good news for the euro.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

This publication is provided as general information only and is not intended as an exhaustive treatment of its subject. TransferWise Inc. and its affiliates (“we” or “us”) expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of this publication, and you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax, investment or other professional advice from us.\u00a0 We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.<\/em><\/h6>\n","protected":false},"excerpt":{"rendered":"

British political uncertainty and better than forecast German industrial production sent the pound euro exchange rate lower on Monday, before Brexit optimism lifted the pound into the close. The pound euro exchange rate closed Monday\u2019s session at flat at \u20ac1.1435. The pair is holding those late gains in early trade on Tuesday. Brexit headlines acted […]<\/p>\n","protected":false},"author":163946597,"featured_media":5348,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1380,1379],"tags":[1396,1386,1594,1395,1393,1636,1388,1635,1391,1414,1392],"class_list":{"0":"post-11505","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-eur","8":"category-gbp","9":"tag-boris-johnson","10":"tag-brexit","11":"tag-deal","12":"tag-eur","13":"tag-euro","14":"tag-german-zew-data","15":"tag-jobs-data","16":"tag-mark-carney","17":"tag-pound","18":"tag-recession","19":"tag-sterling"},"acf":[],"yoast_head":"\nGBP\/EUR: Pound Volatile As Brexit Talks Continue - Currency Live<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/currencylive.com\/news\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Fiona Cincotta\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/EUR: Pound Volatile As Brexit Talks Continue\",\"datePublished\":\"2019-10-15T07:00:16+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\\\/\"},\"wordCount\":865,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100898-gbp-eur-brexit-weighs-on-pound.jpg\",\"keywords\":[\"boris johnson\",\"Brexit\",\"deal\",\"eur\",\"euro\",\"german zew data\",\"Jobs Data\",\"mark carney\",\"pound\",\"recession\",\"sterling\"],\"articleSection\":[\"EUR\",\"GBP\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2019\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101246-gbp-eur-pound-volatile-as-brexit-talks-continue\\\/\",\"name\":\"GBP\\\/EUR: Pound Volatile As Brexit Talks Continue - 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