The pound fell last week following another warning about how a no-deal Brexit could harm the UK in the future.
However, with new Eurozone data due to be released today, the pound to euro exchange rate could experience some movement, experts have said.
The pound is currently trading at €1.115 against the euro, according to Bloomberg.
Laura Parsons, currency analyst at TorFX, spoke to Express.co.uk regarding the latest exchange rate figures.
“After another fairly bleak week for the pound, the GBP/EUR exchange rate fell back to €1.115.
“UK data is lacking until tomorrow so, unless today brings any Brexit revelations, the main cause of GBP/EUR movement is likely to be today’s Eurozone data, including construction output figures and a speech from a European Central Bank (ECB) official.”
Foreign Secretary Jeremy Hunt’s warning about a no-deal Brexit was responsible for the lowering the GBP/EUR exchange rate to €1.115 on Friday – its worst levels of the week.
Hunt added his voice to many warning about the consequences of a bad Brexit deal, saying: “[A no-deal Brexit] would be a mistake we would regret for generations.”
This assessment has had a noticeably negative effect on demand for the pound, even though Hunt later rolled back his remarks by saying: “[It is] important not to misrepresent my words.
“Britain would survive and prosper without a deal… but it would be a big mistake for Europe because of inevitable impact on long-term partnership with the UK.”
At the end of a week that brought fears about higher UK inflation leading to wage squeeze conditions, the pound found little domestic support last week.
Euro traders had a better run of economic data on Friday, with inflation rate growth being reported on the year in July.
The finalised year-on-year readings showed forecast-matching growth in July, which puts the ‘base’ annual figure above the European Central Bank (ECB) target at 2.1 per cent.
These results have raised hopes for an early-2019 interest rate hike from the ECB, as higher inflation gradually increases pressure on central banks to raise interest rates.
Another factor supporting the euro on Friday was the news that Turkey’s economic crisis may be resolved, thereby preventing knock-on damage to Eurozone banks.
As well as Qatar pledging to invest billions of dollars to shore up the Turkish economy, Turkish Finance Minister Berat Albayrak has outlined plans to reduce inflation.
While the option of raising Turkish interest rates is not looking likely at the moment, these planned measures have still reassured traders and pushed the lira and euro higher.
This week’s first significant piece of economic data will come from the Eurozone and cover reported construction output on the year in July.
Last week, Turkish lira sold out in many travel bureaus or ran the risk of running out thanks to an influx in Britons wanting to get the best exchange rate, following the Turkey economic crisis which has caused it to plummet.
The strong rates are enticing British tourists in light of the struggling euro exchange rate against the pound.
