ExchangeRates.org.uk – The Pound (GBP) climbed against the Euro and
most of its peers on Tuesday following the publication of the UK’s latest
jobs data.The country’s latest unemployment rate printed in line with
market expectations in the three months leading up to October, and came
in at 4.3%.
However, the latest average earnings (excluding bonuses) index exceeded
expectations in the same time period, and rose from 4.9% to 5.2%, ahead of
a more modest 5% estimate.
The acceleration in the UK’s latest wage growth data served to dampen
Bank of England (BoE) interest rate cut bets on Tuesday, which
underpinned Sterling sentiment throughout Tuesday’s European session.
The Euro (EUR) traded in a wide range on Tuesday, down against several of
its counterparts but held steady elsewhere, following the publication of a
duo of impactful data releases from within the Eurozone’s largest economy.
Firstly, Germany’s latest Ifo business climate index came in below market
expectations on Tuesday, and marked the lowest reading since May 2020,
hobbling the common currency.
However, Germany’s latest Zew economic sentiment index exceeded
market expectations, and rose to a four-month high, capping some of the
Euro’s losses.
GBP/EUR Forecast: Inflation in the Spotlight
Looking ahead, the primary driver of movement for the Pound Euro
exchange rate looking at Wednesday will likely be the publication of both
the UK’s and the Eurozone’s latest inflation readings.
Looking at the UK, the latest consumer price index (CPI) for November is
forecast to report a rise in both headline and core inflation.
Should the data print as expected, GBP exchange rates could continue to
strengthen during mid-week trade should the data further undermine Bank
of England interest rate cut bets.
Turning to the Euro, the Bloc’s finalised CPI data for November is expected
to report that headline inflation edged higher while core inflation remained
the same.
Should the data print as expected, this could also offer some marginal
support to the single currency moving into Wednesday’s European session.
Pound Euro Exchange Rate Firms following Upbeat UK JobsData
