Pound euro exchange rate: GBP climbs despite decent German factory data
The pound is attempting yet again to claw back recent losses against the euro (Image: GETTY)
Better-than-expected German factory orders did little to aid the euro this morning, despite activity for October rising by 0.3 per cent despite a predicted fall compared to last month. Compared to October last year, however, the figure fell by -2.7 per cent. Yesterday saw some disappointing Markit UK services PMI data for November, which fell to a lower-than-expected 50.4 from 52.2 – just above contraction territory. The Eurozone also saw PMI data releases for November, with the majority increasing – apart from the German services PMI, which remained steady.
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Q3 Eurozone GDP is set to be released tomorrow morning, and is likely to cause movement in the single currency, potentially giving it ammunition to rise against the pound.
With a lack of UK data for the rest of the day, the pound remains sensitive to Brexit headlines.
International Trade Secretary Liam Fox has warned Parliament may try to “steal Brexit from the British people”.
However, the main issue is the Irish backstop arrangement, which Theresa May stated would be “part of any deal […] there is no deal without a backstop”.
The issue of the backstop is highly controversial as many Brexiteers believe it is part of an attempt to keep the UK indefinitely tied to the European Union.
Suggestions being made that the vote in Parliament scheduled for next week is to be delayed have been dismissed by Theresa May.
The Prime Minister told BBC Radio 4: “What I’m doing is leading up to a vote on Tuesday.”
Either way, some market analysts have warned that the pound could drop several percentage points against the euro if MPs vote against Mrs May’s Brexit agreement.