The pound “continued its downtrend” yesterday following the defeat of the Brexit bill in parliament.

However, speeches from European Central Bank (ECB) officials could prove influential before the Bank of England’s rate decision on Thursday.

According to Bloomberg, the pound is currently trading at €1.138 against the euro.

Laura Parsons, currency analyst at TorFX, spoke to Express.co.uk regarding the latest exchange rate figures.

“The pound continued its downtrend on Tuesday as the UK government’s Brexit bill was defeated in the House of Lords,” Parsons said.

Pound to euro exchange rate: Sterling “continues its downtrend” after UK Brexit bill is defeated

“The GBP/EUR exchange rate is currently trading in the region of €1.137. 

“Today’s reports from the Confederation of British Industry (CBI) could have a modest impact on GBP/EUR in the absence of any more notable data.

“But speeches from European Central Bank officials may prove more influential ahead of tomorrow’s Bank of England (BoE) rate decision.”

ECB President Mario Draghi addressed the ECB Forum on Central Banking yesterday.

Draghi insisted that inflation in the bloc is gradually returning towards the bank’s target of two per cent whilst the Eurozone economy continues on a path of growth.

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Pound to euro exchange rate: Sterling “continues its downtrend” after UK Brexit bill is defeated

pound exchange rate, euro exchange rate, pound to euro, exchange rate, exchange rates, pound to euro exchange rate, brexit news, brexit latest, uk brexit, money exchange, travel money exchange, European Central Bank, ECB, Bank of EnglandBloomberg

Pound to euro exchange rate: According to Bloomberg, the pound is currently trading at €1.138

He also stressed, however, that uncertainty continues to permeate the economic outlook and that monetary policy will have to remain “persistent and prudent.”

Unsurprisingly, this outlook remained consistent with the attitude revealed at last week’s ECB rate meeting, with the bank not expecting to have to raise interest rates until after the summer of 2019.

Investors continued to weigh up the British Chambers of Commerce’s (BCC) gloomy forecast yesterday.

But fresh news that UK Prime Minister Theresa May had lost a vote on her Brexit legislation in the House of Lords also caused some destabilisation.

Peers in the upper house essentially backed an amendment that would ensure a “meaningful vote” for Parliament on any final deal with the EU.

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Pound to euro exchange rate: Speeches from European Central Bank officials could prove influential

This lack of influence for ministers has added to tensions, with a lack of clarity over the Brexit process continuing to postpone Sterling’s recovery.

This is also notable in that as long as Brexit negotiations are regarded as a risk factor for the British economy then we could see uncertainty spilling into key areas, such as business investment.

In turn, this could push BoE policymakers away from a process of monetary tightening this summer.

Sterling investors are now preparing for Thursday’s June BoE rate decision, with the accompanying statement and press conference regarded as the more significant events given the fact that a rate rise is not expected.

If the bank cites the strength of the UK’s labour market, or even the Q2 recovery in economic growth, then we could see the groundwork being laid for a rate rise in August.

If they remain tight-lipped, however, then pound euro might struggle to find its footing.

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