Pound euro exchange rate springs back from ‘two-week lows’ but ‘Brexit woes on horizon’

Pound to euro exchange rate sees slight upturn following drop

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The pound to euro exchange rate remains “rangebound” after a sudden drop yesterday. According to experts, yesterday sterling fell to a “two-week low” before recovering its former position all within 24 hours.

The pound is currently trading at a rate of 1.1598 against the euro according to Bloomberg at the time of writing.

Speaking exclusively to Express.co.uk, Michael Brown, currency expert at Caxton FX, explained his insight into the current exchange rate.

“Sterling touched two-week lows against the euro yesterday, though that is a less significant milestone than it sounds given the tight trading range of late, and the pound’s losses have been recovered overnight,” he said.

“Another quiet data docket lies ahead, likely leading to a rather quiet trading day once more.”

George Vessey, currency strategist at Western Union Business Solutions, added: “GBP/USD is holding steady at around 1.4150.

“In doing so, the pair struggles to justify tapering fears with upbeat sentiment over the UK’s easing of virus-led activity restrictions.

“However, Brexit woes could be on the horizon.

“At the moment, Britain has only attempted to accelerate its vaccination campaign without stopping the reopening on June 17.

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“That has supported sterling alongside data releases last week that showed British inflation more than doubled in April and UK unemployment unexpectedly fell between January and March.

“The key question is whether rising inflation will impact the Bank of England’s (BoE) monetary policy, prompting it to raise rates sooner.

“Brexit is at the margins of the headlines, but several issues are yet to be resolved.

“Any impasse in talks about the services sector could weigh on the pound.”

Though the pound is currently back in a “rangebound” position, Britons jetting off to “green list” European destinations may be hoping to swap their travel money before any significant changes occur.

While rates may be steady now, experts warn holidaymakers should not rush into buying travel money.

James Lynn, CEO and co-founder of Currensea, explained: “While it’s excellent news international travel is opening up, the proposed traffic light system will mean there will still be an element of disruption this summer, both to travel companies and consumers.

“Extra caution and careful planning will be really important when it comes to planning holidays this year – and keeping abreast of the latest updates will be key.

“Financial safety when travelling must also be top of mind for consumers. Sudden changes and cancellations, which remain likely could put travellers at risk if the right precautions aren’t taken.”

Holidaymakers should instead wait until they are certain their destination is on the “green list” and their travel plans are going ahead before purchasing their foreign currency.

“For those looking to travel abroad this summer, following the pound and keeping an eye on both exchange rates and the latest travel announcements are some of the best and most simple ways to make sure they get the most for their money,” added Ian Strafford-Taylor, CEO at travel money specialist FairFX.

“Although 12 countries and territories appear on the approved green list, holidaymakers will be hoping for more positive news at the next review in three weeks’ time, as many of our favourite summer destinations are still in the precarious amber category.”

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