Euro to British Pound is at 0.8536, just above the 2021 lows of 0.8480. Despite economic growth in the second quarter, the EUR/GBP is trading at July lows.
Euro to British Pound
The current exchange rate of the Euro to British Pound currency pair is at 3-month lows. The EUR/GBP pair shows a declining trend towards the April lows at 0.8480 levels, which is also a one-year low.
The Euro to Dollar today is at 1.1870, at a three-week high. The value of one Euro to USD in the foreign exchange market shows a gradual recovery as it moves towards the 1.19 level. The Euro to Dollar today strengthens as the Dollar sees high selling pressure.
The currency change of the Pound to Euro today is at 1.3900. The British Pound to USD reached the highest point at 1.3970 on Friday, July 30, but weakened slightly towards the end of the day.
Euro to Dollar conversion in the foreign exchange market moved to a one-month high at 1.1910 levels on Friday, July 30. The Euro closed below the 1.19 level against the US Dollar last week.
Dollar to Euro conversion is at 0.8427 levels on Friday, July 30. The Dollar to Euro conversion reached 0.85 levels in July but slipped to lower levels for the month.
Economic Recovery in the Eurozone
The Eurozone shows steady growth in the second quarter. The region was in recession for two consecutive quarters, as lockdown restrictions imposed during the pandemic hurt economic activities.
The exchange rate Euro to USD slipped to 1.17 levels during the pandemic in March 2020, when coronavirus infections were very high.
Inflation in July is at 2.2%, while in June it was at 1.9%. Inflation in the Eurozone is above 2.0%., which has weakened the Euro to British Pound. The German election is another issue to contend with that keeps the current exchange rate of the 1 Euro in USD lower.
Italy and Spain are some countries that saw a sharp rebound, with business activities picking up and consumer confidence moving higher. Most countries in the Eurozone show signs of recovery. After lockdown restriction started to ease, small businesses are recovering as life moves back to normalcy. However, the Delta virus continues to infect some regions. The government makes people follow social distancing and wearing masks as mandatory precautions.
But some countries like Germany are still hit by the lockdown curbs. Expansion for the first quarter is at 1.5% in Germany. In France, growth is at 0.9%. Supply chain issues are the chief cause of the German slowdown, say analysts. The Euro to Dollar conversion slipped lower, with inflation worries. Only as job opportunities in these regions improve, economic conditions can recover.
The ECB has no plans to raise interest rates in the short term. Even though the Eurozone shows strengthening economic conditions, inflation may rise above the target. Key fundamentals in the Eurozone are improving, bringing in a dovish outlook from the ECB, which has sustained the exchange rate Euro to USD.
The closely watched level is at 0.8500, as it has provided strong support for the year 2021, preventing 1 Euro in USD from moving lower.
1 USD in Euro is 0.8425. The USD to Euro Exchange Rate slipped to 0.8200 levels in June 2021. But the recent uptrend has brought 1 USD in Euro to move above 0.84 levels.
Pound to Euro at July High
The currency change of the Pound to Euro closed almost at the month's highs. The British Pound to USD currency pair shows a positive trend as the economy shows signs of recovery after the pandemic.
Bank of England policy update on Thursday is a key event to watch out for this week. The Monetary Policy Report will bring a new forecast to uplift the economy apart from guidance on quantitative easing and rate policy. Analysts expect the Bank of England to reverse its policy stand with the economy showing signs of recovery, which has kept the British Pound to Dollars positive.
The Gibraltar issue between Britain and Spain raises new conflicts between the two countries. Northern Ireland is another issue that the UK has against the EU. Economic fugitives enter France in large numbers, which is posing another problem.
The foreign currency exchange of the British Pound to Dollars is at 1.3901 levels.
Vaccine Rollout Lowers Covid Fear
The Delta Covid variant continues to create uncertainty in the economy. Now, policymakers sound a word of caution about rushing into a rate hike.
The vaccine rollout has been significant, and it should dampen the severity of the Covid attack. Despite the Delta Covid causing a scare, there is no need to re-impose restrictions, say experts.
The US economy shows slower than expected growth for the second quarter. However, the government stimulus package has kept the flow of money intact as people have the resource to spend on goods and services. The vaccine rollout has been good, though the Delta variant is a scare that has made mask-wearing mandatory.
The FOMC event on Wednesday keeps the foreign currency exchange of the US Dollar under pressure.
