The pound dropped against the euro yesterday as Brexit optimism decreased which negatively impacted the currency. Theresa May’s proposed Brexit deal has not attracted the desired support among MPs. What’s more, the European Commission has suggested that a no-deal Brexit could be more likely which has “added to sterling’s woes,” experts have said. New UK data is out today but it’s unlikely GBP will be positively affected – although the euro could benefit.
The pound is currently trading at €1.168 against the euro, according to Bloomberg at the time of writing.
Laura Parsons, currency analyst at TorFX, spoke to Express.co.uk regarding the latest exchange rate figures.
“The pound broadly declined on Monday, with GBP/EUR falling to a low of €1.163, in reaction to an ongoing lack of support for PM Theresa May’s proposed Brexit deal,” Parsons said.
“The European Commission added to Sterling’s woes by indicating that the odds of a no-deal Brexit have risen.
“Today’s UK data (BBA loans for house purchase) is unlikely to have any impact on the pound in light of the heavy focus on Brexit developments but the euro could benefit if Germany’s Gfk consumer confidence measure shows an improvement in sentiment.”
Yesterday the better-than-expected German IFO expectations survey rose to 95.6, while the business climate index rose to 99.6, and both of these figures were the highest readings in three months.
March’s German IFO current assessment also rose to 103.8 despite forecasts for a decline. After the recent run of disappointing data releases for the currency bloc this report was well received.
As for the UK, MP Boris Johnson said that May needed to set out “convincing proofs” displaying how the next phase of her Brexit negotiations would be different.
He wrote in the Telegraph: “If she cannot give that evidence of change – she should drop the deal, and go back to Brussels, and simply set out the terms that so many on both sides – Remainers and Leavers – now believe are sensible.
“Extend the implementation period to the end of 2021 if necessary; use it to negotiate a free trade deal; pay the fee; come out of the EU now – without the backstop. It is time for the PM to channel the spirit of Moses in Exodus, and say to Pharaoh in Brussels – let my people go.”
So how will today’s exchange rate affect holidaymakers? Today, the Post Office is offering a euro rate of €1.1288 for over £400 and a rate of €1.1416 for over £1,000.
Travellers need to be careful when it comes to buying travel money at this time of political uncertainty.
Greg Baggio, Head of FX at WeSwap, said: “WeSwap’s research has consistently found that nearly half of all Brits find and buy their foreign currency in the space of one day. This leaves them vulnerable to forces beyond their control that dictate the strength of the pound.
“With uncertainty still manipulating the value of currencies, in addition to political news causing unpredictable shifts, holidaymakers need to think strategically around timings for currency exchanges.”
If you’re looking to save money when booking a holiday there’s a key thing you should do when browsing flight comparison sites.
Louis Bridger, Head of International Currency Exchange (ICE) in the UK, told Express.co.uk “a smart way to browse freely and protect you against higher prices is to switch to ‘incognito mode.”
