British Pound Sterling | Currency News Views and Outlook
Pounds to euros: Exchange rate softens, but GBP to EUR could reclaim key level should markets deteriorate
- Details
- Category: British Pound Sterling
- Published on Thursday, 19 January 2012 10:16
- Written by Sam Coventry
Driving the pound euro rate lower, and the pound to dollar exchange rate higher, is the prevailing risk-on sentiment on the exchange rate markets.
Those looking to convert pounds to euros will find they will find the GBP to EUR spot rate at 1.1992. Meanwhile those looking to convert pounds to dollars will find the GBPUSD spot rate at 1.544.
The pound to euro exchange rate has softened over the course of the past 24 hours, the GBPEUR has now settled below the significant level of 1.2.
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However, the depreciation is not a large one, and there is every chance that should news-flow out of the Eurozone deteriorate then the exchange rate will pick up.
Driving the pound euro rate lower, and the pound to dollar exchange rate higher, is the prevailing risk-on sentiment on the exchange rate markets.
The feel-good factor was boosted after the IMF announced yesterday its intention to increase the size of its kitty from $400bn to $1tn, presumably with at least one eye on the EU's failure to boost its own stability fund.
The proportional nature of the IMF's funding would mean a contribution from Britain of between £15bn and £17.5bn, depending on which newspaper you happen to read.
Mark Deans at MoneyCorp comments on the development:
"When the announcement came out yesterday morning it gave an immediate boost to confidence across financial markets. Among currencies, the euro was the main beneficiary and the yen the biggest loser, with the US dollar close on its heels.
"Sterling was all over the place before eventually settling close to its earlier position, just a dozen ticks softer against the euro on the day."
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