Earlier this morning we saw economic sentiment and consumer confidence for Europe both fare slightly worse again than previous, which shouldn’t come as a surprise when considering the economic difficulties Germany are facing, as well as the political turmoil both France and Germany are experiencing.
As we know, Germany’s government is in collapse with a confidence vote set to take place on January 15th next year. With a possible snap election to follow in March. Germany contributes 40% to the whole Eurozone and so therefore any uncertainty in Germany generally ripples through Europe. France are also now facing potentially tough times as the government is set to what seems to be a very unpopular budget, with another confidence vote potentially being tabled as an outcome of this budget. If we were to see two confidence votes in Europe’s biggest economies, it would no doubt weigh even further down on the currency.
Moving into tomorrow, we have the eagerly anticipated release of German Retail Sales for October. Expectations suggest sales will have declined since September’s reading by over 1% which again will be damaging for The Euro especially considering the battle currently being fought with Inflation. With GBP/EUR currently floating close to the highs of 2024, the next 24 hours could allow GBP to break these levels and test new highs before we learn of the Bank of England’s interest rate decision at their next meeting on the 7th December.
GBP/EUR 1.1994 GBP/USD 1.2656 GBP/AED 4.6504
GBP/AUD 1.9487 GBP/CHF 1.1180 GBP/CAD 1.7734
GBP/NZD 2.1507 EUR/USD 1.0539 GBP/ZAR 22.9825