Dear Subscriber, Please find below our latest update for your chosen currency. If you need to discuss your requirements further, please contact your account manager or call us on 0800 612 9625 or +44 (0)1736 335250. GBP EUR Market Update The Pound struck a fresh 9-month high against the Euro at the beginning of this week's session as traders reacted with caution to the possibility that political tensions in Italy could bring down Prime Minister Enrico Letta's coalition government.
Last Monday GBP/EUR advanced by around half a cent in response to a Eurozone Manufacturing data result that failed to impress markets. Coming in at 51.1, the PMI missed analysts' forecasts of 51.7; it was reported that signs of cooling in the usually indomitable German Manufacturing Industry influenced the result. The single currency found it difficult to fight back against the Pound and hopes of a Euro revival were ruined during the afternoon when European Central Bank President Mario Draghi hinted that he could introduce some new monetary easing measures in the near future to boost liquidity within the currency bloc.
The Sterling to Euro exchange rate remained fairly close to the 1.1880 level on Tuesday as the German IFO Business Climate index, an important gauge of financial conditions in the Eurozone's most robust economy, printed at a 17-month high of 107.7. However, the result was slightly lower than markets had anticipated, and was therefore unable to lift the single currency versus the Pound.
GBP/EUR rallied slightly on Wednesday as the Confederation of British Industry (CBI) reported that their index of Retail Sales struck a 15-month high of 34.0 in September. However, the Pound's gains were tempered by the best German Consumer Confidence figure since 2007.
The Pound remained relatively flat against the Euro on Thursday as UK second quarter GDP was confirmed at a relatively impressive 0.7%, but the Current Account deficit was reported to have widened to -£13 billion.
The Euro plunged against the Pound on Friday as German Consumer Prices came in at their lowest level for five months, which stoked fears that the ECB could look to spur credit growth with additional easing measures. Sterling was supported by comments from Bank of England Governor Mark Carney suggesting that, unlike the ECB, the UK Central Bank is not considering any further stimulus at this juncture.
GBP/EUR touched a 9-month high of 1.1984 when markets reopened earlier this morning as traders reacted to the latest political crisis in Italy, the 17 nation bloc's third largest economy. Former PM Silvio Berlusconi has withdrawn support for current Prime Minister Enrico Letta's coalition government, which has raised the prospect of Italy suffering from a prolonged period of political instability. The single currency plummeted as investors attempted to protect themselves from the potential losses that could occur if Italy is unable to continue on its path of fiscal reform.
Later this week we have Eurozone Unemployment numbers and British PMI results on tap, however, these figures are not expected to deviate much from the previous month and this should allow traders to focus on Wednesday's ECB rate decision. It is entirely possible that GBP/EUR could break above the psychologically significant 1.2000 level if the ECB opts for, or hints at, further stimulus. Heads Up: Summary of major upcoming data releases that we think may move the market. | Date | Time | Issuing country/region | Data Item | Market Expectation | Market Sensitivity | | | | | | | | 1st October | 08:55 | EUR | Unemployment Rate s.a. (SEP) | 6.8% | | | | 09:30 | GBP | GBP Purchasing Manager Index Manufacturing (SEP) | 57.5 | | | | 10:00 | EUR | EUR Euro-Zone Unemployment Rate (AUG) | 12.1% | | | 2nd October | 09:30 | GBP | GBP Purchasing Manager Index Construction (SEP) | | | | | 12:45 | EUR | EUR European Central Bank Rate Decision (OCT 2) | | | | | 12.45 | EUR | EUR ECB Deposit Facility Rate (OCT 2) | | | | 3rd October | 09:00 | EUR | EUR Euro-Zone Purchasing Manager Index Composite (SEP F) | | | | | 09:30 | GBP | GBP Purchasing Manager Index Services (SEP) | | | | | 10:00 | EUR | EUR Euro-Zone Retail Sales (YoY) (AUG) | | | | | | | | Sensitivity | | | | | | | Medium | | | | | | | High | | If you need any further assistance, or require a live dealing quote - please do not hesitate to contact me on 01736 335250 or send an email to info@torfx.com Regards,
TorFX 
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