Pound to euro exchange rate rises for ‘fifth straight day’ – should you buy travel money?

Travel money: Post Office introduce multi-currency pre-paid card

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The pound to euro exchange rate has risen for the fifth day in a row. The success of the Covid vaccine in the UK is understood to helped drive GBP upwards. According to experts, there are “hopes that it will lead to a faster economic reopening.”

Looking ahead at today, sterling could well be set to climb further.

The pound is trading at 1.1678 against the euro, according to Bloomberg at the time of writing.

Michael Brown, currency expert at international payments and foreign exchange firm Caxton FX, spoke to Express.co.uk regarding the latest exchange rate figures.

“Sterling extended recent gains against the euro yesterday, rising for a fifth straight day,” said Brown.

“The pound continues to benefit from the UK’s impressive covid vaccination programme and hopes that it will lead to a faster economic reopening.

“Today’s calendar is rather quiet for the cross, meaning that near-term momentum will likely be continued towards a test of the 1.17/1705 region that marked the cycle high a fortnight ago.”

George Vessey, UK Currency Strategist, Western Union Business Solutions, also shared his insight.

“Central banks like the US Federal Reserve and the Bank of England have downplayed the rise in bond yields thus far, whilst the European Central Bank (ECB) is likely to at least verbally intervene, or possibly increase asset purchases this Thursday to cool the bond market rout,” he said.

“Investors are becoming more optimistic about the global economic rebound.

“The vaccine rollouts allowing for economies to reopen, leading to an expected consumer-led recovery in growth and inflation are all contributing to the sell-off in safe-haven government bonds.

“But when yields rise too quickly, financial conditions can be negatively impacted and central banks may be forced to act.

“If the ECB does interject with more stimulus to limit the rise in European yields, then the Euro could come under further selling pressure.”

Vessey added: “GBP/EUR is edging towards the €1.17 handle and could challenge fresh one-year highs this week if the Euro does weaken.”

So what are the major currency providers offering today?

Post Office Travel is currently giving a rate of €1.1255 over £400, €1.1419 for over £500, or €1.1477 for over £1,000.

Despite these favourable rates, experts warn against buying travel money at this time.

James Lynn, co-CEO and co-founder of travel card Currensea, warmed against this while travel abroad remains banned in the UK.

He said: “It may be tempting to take out foreign currency in anticipation of a future holiday, while the exchange rate is favourable.

“However, I would advise against this. Market movements are often more marginal in reality than they appear.

“Especially during this volatile time, it’s safer to keep hold of your money in your UK bank account than purchasing or exchanging for holiday money.”

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