Euro Pound Exchange Rate: GBP hit by profit-takers, EUR Boosted by Latest Confidence Data Amongst Eurozone Business

The Euro to Pound exchange rate is 0.1 pct up on last night's closing level; EUR/GPB is quoted at 0.8397 at 14:30 in London.

The Pound to Euro exchange rate is at 1.1909.

Please Note: All figures quoted here are spot market quotes; your bank will affix a discretionary spread when offering a rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering more currency. Please learn more here.

Pound Sterling rally over?

Paul Robson at RBS is not convinced about the durability of the Sterling rally and holds a more bearish view concerning the Pound's outlook:

"For GBP more generally, the key question is whether the UK recovery is durable. Much is being made of the housing market recovery. However, only prices are really going up rather than activity levels. Activity levels and secured credit growth are still weak and there remains a London/overseas bias.

"For now, we continue to believe that the recovery is just a Summer boomlet, more barbecues than widgets, and this leaves us expecting GBP's rally to soon exhaust."

Pound Sterling hit by profit-taking

The short-term outlook for the pound to euro exchange rate has turned decidedly more shaky, the team at FX Market Alerts have noted the Pound Sterling has come under attack from profit takers:

"Cable is edging lower in quiet trade, pulling back to 1.5880-85 levels in the last few minutes, as more players look to take profit ahead of the FOMC meeting tomorrow night.

"1.6000 has proved to be a stern obstacle over the last 24 hours, with exotic related sales accompanied by longer term selling interest also.

"This has moved EUR/GBP up through 0.8400 in the process, but 0.8410 is as far as we have gotten so far. Good size selling interest reported at 0.8420."

Fundamental drivers behind Euro exchange rates

While the Pound has experienced a small wobble today, the Euro has been boosted by some encouraging data out of Europe today.

Boris Schlossberg at BK Asset Management says:

"In Europe the ZEW survey printed much better than forecast at 49.6 versus 45.3. This was the best reading since March driven primarily by good GDP data. However, the most recent data from the region has missed its mark and may signal that the nascent recovery is facing some headwinds.

"EUR/USD rebounded to hit a high of 1.3370 but the pair stalled at those levels and will likely wait until US session for further directional clues.

"With FOMC release due tomorrow, trade in North America today is likely to be constrained as markets gear up for the main event risk of the month.

"Recent US economic data has been soft and today's NAHB index may be no exception as higher rates could have slowed the demand for housing. With dollar still on the back foot that could push EUR/USD towards 1.3400 as the day proceeds."