GBP/EUR exchange rate: Pound near 7-year low as full Brexit’ is confirmed | City & Business | Finance

Both ministers have stated that there will be a transitional period at the end of Brexit, but that once it is over, the UK will be conclusively ‘out’.

On the other side of the pairing, the euro has only made marginal gains due to disappointing Eurozone data.

Industrial production slowed by more than forecast in June, dropping -0.6 per cent on the month (rather than the -0.5 per cent expected) and easing from 3.9 per cent to 2.6 per cent on the year. 

While today has brought little UK data, we could see high pound volatility over the next couple of days as a result of domestic data releases. 

The first of these announcements will be the UK’s inflation figure for July.

No monthly change is expected, but an annual increase in price pressures is projected. 

Higher inflation would usually raise the chances of a Bank of England (BoE) interest rate hike, but so far the BoE has resisted caving to the pressure. 

This is partly because raising interest rates at the current time could worsen the situation for those with high levels of debt.

Later in the week the UK will be publishing average earnings and employment numbers. 

Rising average earnings would be pound-positive, but stagnant wage figures could send Sterling lower. 

The UK unemployment rate will also be announced on Wednesday, but no change from 4.5 per cent is expected.

For the euro, movement may be caused by Tuesday’s German GDP figures, as well as Wednesday’s Eurozone-wide growth figures.

Economic growth has been predicted in both cases, which may mean that the euro rises against the less stable pound in the middle of the week.

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