Sterling – Euro rate continues fall

The Pound has continued to fall against the Euro, as the UK’s weakening economic outlook along with the probable Euro debt crisis resolution start to affect exchange rates.

BNP Paribas are predicting a rate of around 1.08 by year end. “We have a euro recovery priced in and a key driver of that is stabilisation in Europe on the fiscal side, while we expect there’s more QE to come in the UK which is bearish for the pound”, said Steven Saywell, head of FX strategy.

This morning’s Eurozone trade balance and inflation figures were also better than expected, keeping the value of the Euro on the increase.