The euro rose in the European market on Thursday against a basket of global currencies, to continue its gains for the second day in a row against the pound sterling, thanks to the rise in the yield of German ten-year Treasury bonds, in light of the high pricing of the possibilities of raising European interest rates by 50 basis points next March. .
On the other hand, the yield of British treasury bonds declined for ten years, after data showed a slowdown in consumer prices in the United Kingdom for the third month in a row, which reduced the pricing of raising British interest rates in the future.
The exchange rate of the euro against the pound sterling
The euro rose against the pound sterling by 0.15% to 0.8896, from today’s opening price at 0.8884, and recorded the lowest level at 0.8872.
The euro ended yesterday’s trading, rising by 0.7% against the pound, in the first gain in the last eight days, after recording the previous day the lowest level in two weeks at 0.8800 pounds.
German bond yield
The yield of German Treasury bonds for ten years rose on Thursday, by 0.7%, to extend its gains for the third session in a row, recording the highest level in six weeks at 2.485%, which enhances investment opportunities in the euro.
This development comes in the German bond market, where pricing is still high about the European Central Bank raising European interest rates by 50 basis points next March.
British bond yield
The yield of British treasury bonds for ten years fell on Thursday by 0.3%, to continue its losses for the second session in a row, moving away from the highest level in five weeks, due to correction and profit-taking operations, which put pressure on the exchange rate of the pound sterling.
Data showed on Wednesday in the United Kingdom that consumer prices slowed in January for the third month in a row, which reduced inflationary pressures on the Bank of England, and led to a decline in pricing British interest rates in the near future.
Citibank economists still expect a 25 basis point increase at the next BoE meeting due to strong wage dynamics in the UK, but warn that the possibility of a May halt is increasing after the inflation data.
Citibank strategists recommend buying the euro against the pound sterling, aiming to move to levels of 0.92 pounds, and forex analysts at RBC Capital recommend buying the euro against the pound sterling at the beginning of the week, as they expected a lower reading of consumer prices in the United Kingdom, which is what actually happened. .