GBP Reaches Two-Month High on UK-EU Optimism
The Pound to Euro exchange rate has reached its highest level in two months due to growing optimism about the UK's relationship with the EU. Sterling consolidated its recent gains after Prime Minister Andy Burnham expressed his desire for a closer relationship between the UK and the EU, suggesting that Brexit may have done more harm than good.
The GBP/EUR exchange rate was trading at around €1.1719 on Thursday, up 0.2% from the start of the session. This surge in Sterling's value is largely due to investors hoping that a reduction in UK-EU trade barriers would be beneficial for economic growth.
However, there are some concerns that the Pound may give back some of its recent gains if Eurozone inflation accelerates sharply. The European Central Bank (ECB) is expected to publish September's preliminary consumer price index figures, which are predicted to show a three-year high inflation rate of 3.6%.