All the technical data, charts, tools and indicators you need to analyze and trade the EUR/GBP
BULLISH PERCENTAGE INDEX
The EUR/GBP pair tells the trader how many British Pounds (the quote currency) are needed to purchase one Euro (the base currency). This is one of the most traded currency pairs. Since the European and British economies are massively intertwined (large amounts of capital are exchanged on a daily basis between the UK and all European countries), the pair tends to be relatively stable. But events and news related to the exit of Great Britain of the European Union in 2017 will probably affect the pair and create choppier movements than usual.
FORECAST FOR 2017
FXStreet’s contributors, surveyed at the end of December 2016, forecasts that this “politics-dominated cross” will be at 0,8350 by the end of 2017. See full forecast
They call it a “politics-dominated” pair because 2017 is a year with several important milestones. First of them is obviously the implementation of the so-called Brexit - negotiations as how and under what conditions the UK will leave the European Union will be headlines during most of 2017. There will be other key political events in Europe as the French Presidential elections (in May) and the German federal election (in September).
HISTORIC HIGHS AND LOWS FOR EUR/GBP
- All-time records: Max: 0.98049 on 29/12/2008 - Min: 0.56870 on 01/05/2000
- Last 12 months (March 2016-March 2017): Max: 0.92253 on 03/10/2016 - Min: 0.75648 on 23/05/2016
- Last 5 years (March 2011-March 2016): Max: 0.92253 on 03/10/2016 - Min: 0.69307 on 13/07/2015
ORGANIZATIONS, PEOPLE AND ECONOMIC DATA THAT INFLUENCE EUR/GBP
The organizations and people that affect the most the moves of the EUR/GBP pair are:
- Bank of England (BoE), known to be one of the most effective central banks in the world. It acts as the government's bank and the lender of last resort. It issues currency and, most importantly, it oversees monetary policy (including interest rates). In 2017, as Haresg Menghani wrote, “BoE Governor Mark Carney has already clarified that, if necessary, he would be willing to tolerate an overshoot in inflation, for some period, in order to support the economy. Hence, any signs of economic slowdown might force BoE to announce another interest rate-cut and (or) an extension of its QE program.”
- European Central Bank (ECB) whose main objective is to maintain price stability for the Euro. The ECB (currently headed by Mario Draghi) sets and implements the monetary policy for the Eurozone (including interest rates), conducts foreign exchange operations and takes care of the foreign reserves of the European System of Central Banks.
- London’s City Financial District: This is still the largest and most developed financial market in the world and as a result banking and finance have become strong contributors to the national economic growth.
- The Prime Minister of Great Britain Theresa May, who took the leadership of the UK Government in July 2016 following the EU referendum, will stay under the spotlight as the person at the head of the “Brexit” negotiations between his country and the European Union.
- Angela Merkel, at the head of Germany, the strongest economy of the European Union, is also an important figure for any Euro-related currency cross.
In terms of economic data, as for most currencies, the EUR/GBP traders have to keep an eye on:
- GDP (Gross Domestic Product), the total market value of all final goods and services produced in a country. It is a gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Generally speaking, a high reading or a better than expected number is seen as positive for the EUR, while a low reading is negative.
- Inflation measured by key indicators as the CPI (Core Price Index) and the PPI (Production Price Index), which reflect changes in purchasing trends.
ASSETS THAT INFLUENCE EUR/GBP THE MOST
- Currencies: USD and YEN.
- Commodities: Oil and Gold.
- Bonds: Gilt (debt securities issued by the Bank of England) and Bund (the German word for "bond", a debt security issued by Germany's federal government).
- Indices: FTSE 100 (share index of the 100 companies listed on the London Stock Exchange with the highest market capitalization), ESTX50 (ESTX50 (Euro Stoxx 50, a stock index of Eurozone stocks designed by STOXX, an index provider owned by Deutsche Börse Group) and DAX (Deutscher Aktienindex, German stock index consisting of the 30 major German companies trading on the Frankfurt Stock Exchange).