{"id":4585,"date":"2018-05-23T00:00:00","date_gmt":"2018-05-23T04:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100485-gbp-eur-uk-inflation-high\/"},"modified":"2018-05-23T00:00:00","modified_gmt":"2018-05-23T04:00:00","slug":"100485-gbp-eur-uk-inflation-high","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100485-gbp-eur-uk-inflation-high\/","title":{"rendered":"GBP\/EUR: Will UK Inflaton Lift Pound vs Euro?"},"content":{"rendered":"<p>A surprisingly encouraging testimony from the Bank of England (BoE) helped lift the pound on Tuesday, whilst Italian political jitters continued to weigh on the euro. As a result, the pound euro exchange rate climbed higher, hitting a high of \u20ac1.1416.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>What do these figures mean? <\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>\n<p> 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> For example, it could be written: <em>1 GBP = 1.13990 EUR<\/em> <\/p>\n<p> <em>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.<\/em> <\/p>\n<p> Or, if you were looking at it the other way around: <em>1 EUR = 0.87271 GBP<\/em> <\/p>\n<p> <em>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.<\/em> <\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n<p>The Bank of England testimony to the Treasury Select Committee was more upbeat than most market participants were hoping for. Given that the quarterly inflation report and forecast a downgrade inflation and Gross Domestic Product (<a href=\"https:\/\/transferwise.com\/gb\/blog\/gross-domestic-product-meaning\">GDP<\/a>)<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>Why do raised interest rates boost a currency\u2019s value? <\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Interest rates are key to understanding exchange rate movements. Those who have large sums of money to invest want the highest return on their investments. Higher interest rate environments tend to offer higher yields. So, if the interest rate or at least the interest rate expectation of a country is relatively higher compared to another, then it attracts more foreign capital investment. Large corporations and investors need local currency to invest. More local currency used then boosts the demand of that currency, pushing the value higher. <\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n<p>Today investors will look towards UK inflation data to see whether it is inline with the upbeat outlook from the BoE. Analysts are expecting inflation in April to remain constant at 2.5%, whilst core inflation which excludes more volatile items such as food and fuel is expected to tick lower to 2.2%, down from 2.3% in March. Should inflation read lower than the forecast, the pound could decline, as the BoE will be less inclined to hike rates if inflation falls.<\/p>\n<h2><a href=\"#eurozone-pmi-s-in-focus\" name=\"eurozone-pmi-s-in-focus\"><\/a>Eurozone PMI\u2019s In Focus<\/h2>\n<p>The euro was once again on the back foot in the previous session. Concerns over the new Eurosceptic, populist Italian coalition and its politically inexperienced proposed Prime Minister has unnerved many euro traders. Whilst a full on Italian withdrawal from the EU is highly unlikely, this new government could prove to be a headache for the EU project.<\/p>\n<p>Today investors will switch their attention back to economic data, after a quiet week so far on the calendar. German and eurozone manufacturing pmi could create some volatility for the euro if the data points to a continued slowing in momentum in the bloc\u2019s economy.<\/p>\n<table class=\"table table-bordered\">\n<tbody>\n<tr>\n<td>\n<p><small><em><br \/>\nThis publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice 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 or other professional advice from TransferWise Inc., Currency Live or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date. Consult our <a href=\"https:\/\/currencylive.com\/risk-warning\/\">risk warning<\/a> page for more details.<\/em><\/small><\/p>\n<p><small><em>This article was initially published on TransferWise.com from the same author. The content at Currency Live is the sole opinion of the authors and in no way reflects the views of TransferWise Inc.<\/em><\/small><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A surprisingly encouraging testimony from the Bank of England (BoE) helped lift the pound on Tuesday, whilst Italian political jitters continued to weigh on the euro. As a result, the pound euro exchange rate climbed higher, hitting a high of \u20ac1.1416. What do these figures mean? When measuring the value of a pair of currencies, [&hellip;]<\/p>\n","protected":false},"author":163946597,"featured_media":4586,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1380,1379],"tags":[1395,1394,1387],"class_list":["post-4585","post","type-post","status-publish","format-standard","has-post-thumbnail","category-eur","category-gbp","tag-eur","tag-gbp","tag-inflation"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>GBP\/EUR: Will UK Inflaton Lift Pound vs Euro? - 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\/100485-gbp-eur-uk-inflation-high\/\" \/>\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=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100485-gbp-eur-uk-inflation-high\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100485-gbp-eur-uk-inflation-high\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/EUR: Will UK Inflaton Lift Pound vs Euro?\",\"datePublished\":\"2018-05-23T04:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100485-gbp-eur-uk-inflation-high\\\/\"},\"wordCount\":641,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100485-gbp-eur-uk-inflation-high\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100485-gbp-eur-uk-inflation-high.jpg\",\"keywords\":[\"eur\",\"gbp\",\"Inflation\"],\"articleSection\":[\"EUR\",\"GBP\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2018\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100485-gbp-eur-uk-inflation-high\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100485-gbp-eur-uk-inflation-high\\\/\",\"name\":\"GBP\\\/EUR: Will UK Inflaton Lift Pound vs Euro? 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