March 26, 2021 – Written by John Cameron
The Pound to Euro exchange rate is steady this morning after the UK reported a modest growth in retail sales for February, adding support to Sterling.
At the time of writing the Pound to Euro exchange rate is currently trading at around 1.1685.
Pound Sterling (GBP) Exchange Rate Steady as UK Retail Sales Increase in February
The Pound is steady this morning as the UK recorded a modest growth of 2.1% in retail sales for February.
Lisa Hooker, consumer markets leader at the consultancy PwC commented on the growth in the sector, saying:
’ There are signs that consumers are getting used to the realities of life under lockdown, with online sales hitting yet another high of 36.1% of total retail sales.’
’ As we edge towards the re-opening of non-essential stores after Easter, retailers will be hoping that the wave of optimism sweeping consumers as a result of the successful vaccine rollout will translate into increased sales.’
It comes as the UK-EU row over coronavirus vaccines continues, as European Commission President Ursula von der Leyen took another swipe at the UK saying that she had ‘no knowledge’ of the UK exporting any vaccines and was ‘waiting for transparency’ from the country.
However in a joint statement released on Thursday the UK and EU said the two sides would work on a ‘win-win’ situation when it comes to vaccine exports, as investors hope that this means the EU is backing down on blocking the export of the AstraZeneca vaccine.
Euro (EUR) Exchange Rate Muted as German Ifo Business Climate
The Euro has been muted this morning as the row between the EU and UK over vaccine exports continues.
Despite a joint statement from the two saying they were hoping to work through tensions, both continue to take swipes at each other as the EU summit is expected to continue today.
The Euro has found support this morning from the release of the latest Ifo business climate from Germany for April which has increased by almost 3 points to 96.6.
Clemens Fuest, president of the Ifo, commented on the increase in the business climate:
’Companies were clearly more satisfied with their current business situation. Optimism about the coming months has also returned. Despite the rising rate of infections, the German economy is entering spring with confidence.’
GBP/EUR Exchange Rate Forecast: UK Employment Data in Focus
For Pound investors heading into next week, UK GDP data for Q4 and final PMI data for March which will give an insight into how the UK’s economy has been performing as the country begins to reopen from the national lockdown.
Euro traders will be looking towards the Eurozone’s final consumer confidence index for March which is expected to remain in contraction, as renewed lockdown fears and a third wave plague the bloc.
In absence of any notable data over the week, the GBP/EUR exchange rate will be driven by any further coronavirus developments.
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