GBP v EUR unravels and hits a 19-month low amid a parabolic rally by the € and rout in $..
| GBP
| We remain firmly on the fence i'm afraid to write when it comes to forecasts, as the 'all bets are off' environment continues to be at play. 2-weeks ago, we saw 2% lost on GBP v EUR (out of nowhere) with the pair hitting a 7-month.
Last week, a further 1% was given away and all of a sudden £-€ was trading (incredibly) at a 19-month low.
It has been some of the most volatile times of late in all markets that has ever been seen. The unpredictability will unfortunately continue, but we are at least somewhat hopeful that as far as GBP/EUR is concerned the pair has bottomed out.
That doesn't mean a quick recovery from here or a jump back up by 3% is expected though. It just means we can't see, nor can we see others predicting £-€ to fall much lower with all things being considered.
Yes, the Euro and EU is looking stronger than it did pre-Trump, however, these current levels were expected to be flirted with if-and-when the EU outpaces the UK economically and halts its interest rate cutting path and the BoE starts.
For those with an interest in £-$, you would have seen a big jump of 2.5% last week, highlighting the crossfire Sterling finds itself in currently. The Pound is in the green today across the board with a big week ahead in terms of UK data.
Hedging with larger exchanges looks to be the only play I would be suggesting at this time.
EUR
It's official then, the Euro is once again seen as a safe-haven currency. Europe's economy is expected to grow steadily from here (pushed by Germany), inflation is under control, interest rates can't fall much lower and the Euro has gained in value where other beta currencies have not.
Has the ECB worked their magic or is this all just Trump's doing, that's for you to decide..
What we do know for sure is that the Euro is reborn and it may get better yet depending on what the ECB do and say this Thursday.
USD
The Dollar is trading at a 3-year low versus the Euro. This is truly unbelievable because only 2-months ago, most data-houses were suggesting parity was on the horizon. This is now 10% away from happening..
GBP v USD is trading at a 6-month high and is an incredible 10-cents higher compared to just 3-months ago. The Dollar has officially been devalued, the US & USD has lost friends and some safe-haven status and no-one knows what happens next..
|
|
Twitter
Facebook
linkedin
Google
