{"id":5626,"date":"2019-07-09T00:00:00","date_gmt":"2019-07-09T04:00:00","guid":{"rendered":"https:\/\/currencylive.com\/101051-gbp-eur-weak-data-weighs-on-euro\/"},"modified":"2019-07-09T00:00:00","modified_gmt":"2019-07-09T04:00:00","slug":"101051-gbp-eur-weak-data-weighs-on-euro","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/101051-gbp-eur-weak-data-weighs-on-euro\/","title":{"rendered":"GBP\/EUR: Weak Data Weighs On Euro"},"content":{"rendered":"<p>The euro came under pressure in the previous session sending the pound euro exchange rate higher. The pair closed up 0.05% higher at \u20ac1.1160.<\/p>\n<table class=\"table table-bordered\">\n<tr>\n<th><small> What do these figures mean? <\/small><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><small> 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. If the euro amount increases in this pairing, it\u2019s positive for the pound. Or, if you were looking at it the other way around:<em>1 EUR = 0.87271 GBP<\/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. <\/small><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Brexit uncertainty and recession fears prevented the pound from taking advantage of euro weakness in the previous session. With no fresh macro data to digest, investors continued mulling over last week\u2019s hat-trick of disappointing pmi numbers, which point to a contraction in the UK economy in the second quarter.<\/p>\n<p>Brexit remains front and central for pound traders. Over the weekend, Boris Johnson, favourite to win the Conservative leadership battle and takeover as prime minister, ramped up his no deal Brexit rhetoric. However, there is growing opposition in Parliament to a no deal Brexit. This is offering some support to the pound. Some MP\u2019s have said they would resign in the event of a no deal Brexit. Others have said that they are looking at around 30 plus legislative options to prevent a no deal Brexit.<\/p>\n<table class=\"table table-bordered\">\n<tr>\n<th><small> Why is a \u201csoft\u201d Brexit better for sterling than a \u201chard\u201d Brexit? <\/small><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><small> 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. <\/small><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Economists and business leaders have frequently discussed how damaging a no deal Brexit would be for the UK economy. Therefore, any sign that it could be avoided helps underpin the pound.<\/p>\n<p>Today, there is no UK economic data for investors to digest. Instead they will look towards tomorrow\u2019s GDP release, manufacturing and industrial production data. Signs of weakness could weigh on demand for the pound.<\/p>\n<h2><a href=\"#euro-drops-on-fears-of-german-recession\" id=\"euro-drops-on-fears-of-german-recession\"><\/a>Euro drops on fears of German recession<\/h2>\n<p>Monday was not a good day for eurozone economic data. German industrial production figures showed that the sector declined by more than analysts were forecasting. Industrial production declined by -3.7% year on year in May, this was worse than the 3.2% decline forecast.<\/p>\n<p>The weak data comes following last week\u2019s soft German factory orders. The manufacturing sector in Germany, Europe\u2019s largest economy is suffering as demand declines amid a slowing global economy. Fears are growing that the slowdown in the manufacturing sector will spread through the German economy sending it into recession. Eurozone investor sentiment index also dropped sharply.<\/p>\n<table class=\"table table-bordered\">\n<tr>\n<th><small> Why does poor economic data drag on a country\u2019s currency? <\/small><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><small> Slowing economic indicators point to a slowing economy. Weak economies have weaker currencies because institutions look to reduce investments in countries where growth prospects are low and then transfer money to countries with higher growth prospects. These institutions sell out of their investment and the local currency, thus increasing supply of the currency and pushing down the money\u2019s worth. So, when a country or region has poor economic news, the value of the currency tends to fall. <\/small><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Today there is no eurozone economic data. Tomorrow is another quiet day. Thursday\u2019s German inflation figure will be of interest. Analysts expect inflation to remain steady so this could offer some support to the common currency.<\/p>\n<hr>\n<p><small><\/p>\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>The euro came under pressure in the previous session sending the pound euro exchange rate higher. The pair closed up 0.05% higher at \u20ac1.1160. What do these figures mean? 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 [&hellip;]<\/p>\n","protected":false},"author":163946597,"featured_media":5627,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1380,1379],"tags":[1395,1394],"class_list":["post-5626","post","type-post","status-publish","format-standard","has-post-thumbnail","category-eur","category-gbp","tag-eur","tag-gbp"],"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: Weak Data Weighs On 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\/101051-gbp-eur-weak-data-weighs-on-euro\/\" \/>\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\\\/101051-gbp-eur-weak-data-weighs-on-euro\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101051-gbp-eur-weak-data-weighs-on-euro\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/EUR: Weak Data Weighs On Euro\",\"datePublished\":\"2019-07-09T04:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101051-gbp-eur-weak-data-weighs-on-euro\\\/\"},\"wordCount\":833,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101051-gbp-eur-weak-data-weighs-on-euro\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100654-gbp-eur-weak-data-weighs-on-euro.jpg\",\"keywords\":[\"eur\",\"gbp\"],\"articleSection\":[\"EUR\",\"GBP\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2019\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101051-gbp-eur-weak-data-weighs-on-euro\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/101051-gbp-eur-weak-data-weighs-on-euro\\\/\",\"name\":\"GBP\\\/EUR: Weak Data Weighs On Euro - 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