Pound euro exchange rate: GBP stable amid Italian budget jitters

But the exchange rate is still trading around half a cent up on the week starting point.

The euro is moving in a narrow range against the pound this morning, as the single currency is dented by Italian budget concerns.

On the eve of its deadline to present its first budget, media reports suggest there have been fractures within Italy’s new coalition.

The government has been forced to deny reports that Economy Minister Giovanni Tria “was ready to leave”.

Meanwhile, this morning saw the release of the Eurozone’s latest business confidence survey, which revealed sentiment in the bloc languishes at a one-year low this month as firms’ production expectations worsened.

At the same time the Society of Motor Manufacturers and Traders (SMMT) reports that British car production fell 13 per cent last month.

The SMMT reported that the fall was attributed to annual maintenance and re-tooling in the quieter summer months.

Mike Hawes, chief executive of the SMMT, warned: “With exports, the majority to the EU, continuing to drive demand, it underscores the importance of a Brexit agreement to safeguard this trade; for our sector, ‘no-deal’ is not an option.”

Looking to later in today’s session, financial attention later today will turn to speeches by the Bank of England’s (BoE) Mark Carney and the European Central Bank’s (ECB) Mario Draghi.

Following on from his remarks earlier in the week in which he spoke of a “vigorous pick-up in underlying inflation” in the Eurozone, markets will be paying close attention to Mr Draghi’s comments today.

Meanwhile markets will be looking to Mark Carney for any hints on how the recent upswing in UK inflation and the setbacks in Brexit may have altered the BoE’s policy outlook.