The pound to euro exchange rate has continued to fall this week following a week of gains at the start of May. The slump for GBP comes as the euro strengthens in the face of escalating US-China trade tensions. Brexit continues to be a barometer for the pound’s movement amid suggestions discussions between the Government and Jeremy Corbyn’s party were close to collapse. Experts have said there’s a chance GBP could improve ahead of the weekend if the UK’s GDP report shows that growth accelerated in the first quarter of 2019.
The pound is currently trading at €1.159 against the euro, according to Bloomberg at the time of writing.
Michael Brown, currency expert at Caxton FX, spoke to Express.co.uk regarding the latest exchange rate figures.
“Sterling lost ground against the euro on Thursday, sliding for a 4th consecutive day, as the single currency strengthened despite a continued escalation of US-China trade tensions.
“The pound itself struggled for direction, though remains susceptible to downside moves as markets remain on alert for any Brexit-related headlines.
“Barring news flow, markets will be digesting this morning’s preliminary estimate of 1st quarter GDP, with expectations for the economy to have expanded at 1.8 per cent on a year-on-year basis, largely boosted by pre-Brexit stockpiling.
“An upbeat release may see the pound find some support, though market moves are likely to be relatively limited with investors remaining cautious over escalating geopolitical risks.”
Mounting pressure on Prime Minister Theresa May to name her departure date is also weighing on the pound.
A Tory grassroots revolt has been threatened next month if she does not set out specifics on when she will pack her bags and leave Downing Street.
Marshall Gittler, an analyst at ACLS Global, said: “Since most of her likely replacements are even more hard-core ‘Leave’ supporters than she is, this raises the possibility of a hard Brexit, i.e. crashing out with no agreement at all.”
Laura Parsons, currency analyst at TorFX, told Express.co.uk: “GBP/EUR eased back below €1.160 on Thursday as Labour leader Jeremy Corbyn downplayed reports of progress in cross-party Brexit talks.
“However, Sterling might be able to rally before the weekend if the UK’s GDP report shows that growth accelerated in the first quarter of 2019.
“The euro could also be pressured lower if the latest US inflation figures show an uptick in consumer price pressures.”
So how will the exchange rate affect your holiday money? The Post Office is currently offering a pound to euro exchange rate of €1.1368 for over £400 and €1.1422 for over £1000.
Nick England, CEO at EasyFX has cautioned that British holidaymakers should avoid leaving getting holiday money at the airport.
“As the value of the pound continues to follow the same ups and downs of the Brexit debate, those that leave converting their currency until the airport’s bureau de change risk negatively impacting their spending money.” England said.
“Holidaymakers really should take a smarter approach to their cash… By buying half of their spending money now and half later, travellers can both capitalise on Sterling volatility, and protect themselves against any potential crashes from a no-deal Brexit.”
