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Euro to Pound Sterling (EUR/GBP) Exchange Rate – Sterling hits ten-month high on ECB rate cut

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The Pound soared to a nine-month high and the Euro tumbled against all of its most traded peers after the European Central Bank shocked the markets by unexpectedly slashing interest rates to a new record low level of 0.25%.

The shock decision by the ECB saw Sterling rocket against the single currency and saw currencies ranging from the US Dollar to New Zealand Dollar make strong gains as investors sought alternatives to the Euro.

Today’s decision now means that the Central Bank only has one more opportunity to cut interest rates before reaching the zero level. The decision to cut was in response to the recent disappointing inflation data out of the region which showed that inflation had slowed to its slowest pace in four years.

As a result of the cuts the Euro looks likely to weaken further before the end of the year.

“The ECB’s surprise decision to lower interest rates will weaken the Euro, and this is most likely what the Central Bank wants. The ECB’s most potent economic tool to help growth and fight the deflation threat, especially with rates close to zero is the exchange rate. Today’s easing marks the first overt step in massaging the Euro lower. It certainly will not be the last,” said Daragh Maher, currency strategist at HSBC Holding Plc.

The Pound also found support after the Bank of England maintained UK interest rates at a record low and maintained its bond buying stimulus programme. The decision was expected by investors which aided support for the currency.

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“The BoE policy stance looks increasingly out of kilter with the Euro area. You’ve got one Central Bank that’s easing and the other that’s neutral, so that keeps the Pound strong versus the Euro. Sterling should do well against most European currencies,” said Paul Robson, a foreign exchange strategist at Royal Bank of Scotland.

Euro (EUR) Exchange Rates

As of 14:30 am GMT

The Euro/US Dollar Exchange Rate is currently in the region of: 1.3332

The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8323

The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4094

The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.5986

The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.3940

The Euro/ Japanese Yen Rate Exchange Rate is currently in the region of: 132.5401

The Euro/Swiss Franc Exchange Rate is currently in the region of: 1.2305

The Pound Sterling/ Euro Exchange Rate is currently in the region of: 1.2005

The US Dollar/Euro Exchange Rate is currently in the region of: 0.7493

The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7089

The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6251

The Canadian Dollar/Euro Exchange Rate is currently in the region of: 0.7174

Swiss Franc/Euro Exchange Rate is currently in the region of: 0.8125

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