{"id":95573,"date":"2020-02-05T08:33:59","date_gmt":"2020-02-05T13:33:59","guid":{"rendered":"https:\/\/currencylive.com\/news\/?p=95573"},"modified":"2020-02-05T08:34:50","modified_gmt":"2020-02-05T13:34:50","slug":"102288-gbp-eur-lagarde-says-forward-guidance-is-effective","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\/","title":{"rendered":"GBP\/EUR: Lagarde Says Forward Guidance is \u201cEffective\u201d"},"content":{"rendered":"

The British pound<\/a> is higher against the euro on Wednesday afternoon after data showed a recovery in the UK service sector while at the same time speeches from ECB President Lagarde and data from the Euro area weighed on the euro.<\/p>\n

GBP\/EUR<\/a> was higher by 48 pips (+0.40%) at 1.1843 with a daily price range of 1.178 to 1.186 as of 1pm GMT. Having started the day below 1.18 the currency pair rallied up to 1.185 by lunchtime. The gains add to the +0.42% rise on Tuesday but the exchange rate is still down on the week after hefty losses on\u00a0 Monday.<\/p>\n

GBP to EUR – A surprise pickup in the UK\u2019s all-important service sector has come to the aid of Sterling<\/h2>\n

The was currency on track for a second day of gains but still down on the week. The UK Markit Services PMI saw a surprise rise to 53.9 when it was expected to remain steady at the 52.9 printed in December. This adds to the faster-than expected rise in construction reported by purchasing managers on Monday.<\/p>\n

The business surveys are all pointing to a \u2018Boris bounce\u2019 in the economy<\/a> after the UK general election. If all else remained equal, the UK economy outperforming that of the Eurozone should be a recipe for GBP\/EUR<\/a> strength. However, it isn\u2019t all equal and the pound is still being pressured by Brexit uncertainty.<\/p>\n

The euro<\/h3>\n

Speakers from the European Central Bank were out in force on Wednesday, the highlight of course being new ECB President Christine Lagarde. With Europe\u2019s central bank in the middle of a strategic review, all the ways it conducts itself are under the microscope.<\/p>\n

Today the focus was \u2018forward guidance\u2019 and whether it should be abandoned. As a reminder \u2018forward guidance\u2019 refers to the communication from a central bank about the state of the economy and likely future course of monetary policy.\u00a0Lagarde described forward guidance as an \u201ceffective automatic stabiliser\u201d \u2013 suggesting it was here to stay as a policy tool by the ECB after the strategic review. And by way of some guidance on the environment for setting interest rates Lagarde described a lot of short-term uncertainties, which will presumably deter the ECB from raising rates anytime soon.<\/p>\n

\n
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The British pound is higher against the euro on Wednesday afternoon after data showed a recovery in the UK service sector while at the same time speeches from ECB President Lagarde and data from the Euro area weighed on the euro. GBP\/EUR was higher by 48 pips (+0.40%) at 1.1843 with a daily price range […]<\/p>\n","protected":false},"author":163946598,"featured_media":5460,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1380,1379],"tags":[1481,2234,1629,1395,1849,1394,1679,1454],"class_list":{"0":"post-95573","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-eur","8":"category-gbp","9":"tag-christine-lagarde","10":"tag-construction-report","11":"tag-economics","12":"tag-eur","13":"tag-eurozone","14":"tag-gbp","15":"tag-markit","16":"tag-pmi"},"acf":[],"yoast_head":"\nGBP\/EUR: Lagarde Says Forward Guidance is \u201cEffective\u201d - Currency Live<\/title>\n<meta name=\"description\" content=\"The British pound is higher against the euro on Wednesday afternoon after data showed a recovery in the UK service sector.\" \/>\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\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Ileana Ionescu\" \/>\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\\\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\\\/\"},\"author\":{\"name\":\"Ileana Ionescu\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/3d5cb0a6a22d357fc0b9ad562f35e75b\"},\"headline\":\"GBP\\\/EUR: Lagarde Says Forward Guidance is \u201cEffective\u201d\",\"datePublished\":\"2020-02-05T13:33:59+00:00\",\"dateModified\":\"2020-02-05T13:34:50+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\\\/\"},\"wordCount\":620,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100954-gbp-eur-euro-slips-eurozone-data.jpg\",\"keywords\":[\"Christine Lagarde\",\"construction report\",\"economics\",\"eur\",\"eurozone\",\"gbp\",\"markit\",\"pmi\"],\"articleSection\":[\"EUR\",\"GBP\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2020\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/102288-gbp-eur-lagarde-says-forward-guidance-is-effective\\\/\",\"name\":\"GBP\\\/EUR: Lagarde Says Forward Guidance is \u201cEffective\u201d - 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