The Euro strengthened against the British Pound on Tuesday after the UK currency was weakened by comments made by Bank of England Governor Mark Carney. Earlier in the session the Euro came under some pressure as data showed that business sentiment in the Eurozone’s largest economy fell in June. The Ifo’s business climate index for Germany showed a decline to 109.7 from an unrevised 110.4 recorded in May. The figure was also below economist forecasts for a figure of 110.2. The cause for the decline in sentiment was being blamed on company concerns over the situation in Ukraine and the escalating conflict in Iraq. “Global uncertainties are taking their toll. Germany’s domestic fundamentals remain solid, but we need to watch the situation in Ukraine, Russia and Iraq carefully,� said an economist at Berenberg Bank. Some of those tensions were eased somewhat today after news broke that Russian President Vladimir Putin asked Russian lawmakers in the nation’s parliament to rescind approval to use force in Ukraine. The move will be welcomed by the West and adds to a sense of optimism that the crisis can be resolved without further bloodshed. The pro-Russian separatist rebels in the country also declared a ceasefire yesterday. The Pound meanwhile fell broadly against all but one of its major peers after Carney disappointed investors by saying that recent wage data could delay an interest rate rise. Carney told a parliamentary committee that a rate rise will depend on data and singled out the recent weak wage growth data as a point which could hold back any rate move. “Taken in isolation, the developments on the wage front suggest to me that there has been more spare capacity in the labor market than we had thought,� Carney told lawmakers in London at a hearing on the BOE’s May inflation report. Currently the Euro is trading against the British Pound in the region of 0.8014 and is trading against the US Dollar in the region of 1.3620.

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