EUR/GBP rises on ECB steady stance, but French political uncertainty looms
- EUR/GBP rises for the second consecutive day, supported by the European Central Bank’s stable monetary policy stance.
- Political uncertainty in France remains a risk for the Euro while markets await for the new Prime Minister to be named by Friday.
- BoE's Mann reinforces expectations of a prolonged restrictive policy in the United Kingdom.
EUR/GBP holds its gains on Friday, trading around 0.8710, up 0.20% for the day at the time of writing. The single currency benefits from the release of the European Central Bank’s (ECB) September Monetary Policy Meeting Accounts on Thursday, which showed broad agreement among policymakers that the current monetary policy stance remains consistent with the 2% medium-term inflation target. ECB members agreed that current interest rates are sufficiently restrictive to absorb potential shocks.
However, the Euro (EUR) may face near-term challenges as the political crisis in France adds uncertainty to the country’s fiscal outlook. The resignation of Prime Minister (PM) Sébastien Lecornu, following the failure of budget negotiations, has raised concerns about political gridlock. French President Emmanuel Macron is expected to appoint a new PM within the next few hours to avoid parliamentary dissolution, but markets remain skeptical about his ability to push the budget through a divided legislature.
In the United Kingdom (UK), the British Pound (GBP) finds support in recent comments from the Bank of England (BoE) Monetary Policy Committee member Catherine Mann, who said on Thursday that monetary policy must remain restrictive for longer to contain persistent inflation and create an environment conducive to growth. She added that “inflation remains stubborn and the outlook for growth remains modest,” according to Reuters.
A cautious tone from the UK government also helps stabilize the currency. Chief Secretary to the Treasury James Murray said on Wednesday that departments would not be allowed to use emergency funds to finance pay rises, aiming to avoid a wage–price spiral. He noted that this “prudent but tough approach to public spending is what will help build a stable economy”, reported Reuters.
Euro Price Today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the British Pound.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.10% | 0.06% | -0.08% | -0.01% | 0.01% | 0.11% | -0.17% | |
| EUR | 0.10% | 0.20% | -0.02% | 0.09% | 0.18% | -0.02% | 0.03% | |
| GBP | -0.06% | -0.20% | -0.20% | -0.13% | -0.04% | -0.00% | -0.22% | |
| JPY | 0.08% | 0.02% | 0.20% | 0.16% | 0.16% | 0.20% | 0.02% | |
| CAD | 0.01% | -0.09% | 0.13% | -0.16% | -0.03% | 0.10% | -0.07% | |
| AUD | -0.01% | -0.18% | 0.04% | -0.16% | 0.03% | 0.06% | -0.18% | |
| NZD | -0.11% | 0.02% | 0.00% | -0.20% | -0.10% | -0.06% | -0.24% | |
| CHF | 0.17% | -0.03% | 0.22% | -0.02% | 0.07% | 0.18% | 0.24% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
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