EUR/GBP - currency pair Forex, reflecting the measure of the number of units of the pound in one euro.
The symbolic designation of the euro currency is€, the letter code on the market Forex - EUR, the symbolic designation of the British pound sterling is £, the ticker code is GBP.
Features of the currency pair
The couple can quite be called odious. The United Kingdom, which includes the British pound (sterling), which is in the denominator, joined the European Union, retaining its currency and receiving some preferences. After the referendum on leaving the EU ("Brexit"), the British economy should be considered as separate from the EU, with the consequences resulting in a catastrophic fall in the value of the pound against all world currencies.
The currency belongs to the class of cross-exchange currencies that are not expressed in terms of the dollar. According to the standards of the freely convertible market adopted at the international monetary conference in the late 70s (Kingston, Jamaica), the exchange rate of national currencies was determined by free buying and selling on the international interbank market relative to the US dollar. But later, the market created various combinations of the ratios of pairs without the dollar. In the end, there are no obstacles to "recalculate" any two currencies, taking as a basis US dollar.
The main feature of these currencies is that the "morning" and "afternoon" activity is different from other currency pairs, whereas the "evening" activity is the American session in the absence of significant news about the state of the US economy, the pair has a more "calm" reaction.
National exchanges play an important role in the intraday impact on foreign exchange exchange rates of their countries. This happens for many reasons. First, if the national exchange has a high trading turnover, it affects, in one way or another, all the rates of world instruments, such are the consequences of globalization and developed communications that allow electronic trading. The largest stock exchanges in the world are located on the territory of Europe and the UK. The London LSE "attracts" 50% of international securities trading. Secondly, the strategies of modern financial institutions are complex, diversified and hedged; the relationship of assets "forces" to win back exchange rate jumps (or gaps) that occur at the opening of the stock market.
Impact of monetary policy
The European Central Bank (ECB) and the Monetary Policy Committee, headed by the Head of the Central bank of England and prominent economists of the Kingdom, have a direct impact on the exchange rate of national currencies.
After the 2008 crisis, the Committee lowered the rate to 0.5% and kept it at this level until August 2016. The European Central Bank is pursuing a policy of zero rates, to which it has reached, consistently reducing the rate since the 2008 crisis.
The dimension of the pair is one decimal place and a four-digit or five-digit digit after the decimal point (0.90095). The pair seeks to restore the "pre-crisis" (2008) values of its quotes.