The pound to euro exchange rate is teetering on the brink of another dismal record as currency experts warm of “weak” support for sterling today. GBP looked to be gaining back a bit of ground last week, following a torrid start to the month and fluctuations due to the Brexit crisis and UK Conservative party leadership contest. The pound is currently trading at 1.116 against the euro, according to Bloomberg, at the time of writing. Michael Brown, of Caxton FX, told of the potential impact of Bank of England talks today.
He said: “Sterling edged lower against the euro on Tuesday, falling close to a one-week low as political uncertainties continued to pressure the pound.
“Furthermore, a lack of major data releases on either side of the pairing helped to keep market participants on the sidelines, resulting in little support for sterling.
“Today’s main event for the pound is set to be the Bank of England’s quarterly Inflation Report testimony, with a number of policymakers, including Governor Mark Carney, set to appear in front of the Treasury Committee of MPs.
“Of particular interest will be any hawkish comments, reiterating that the market is underpricing policy tightening from the Bank.
“However, after striking a relatively downbeat tone in last week’s policy statement, the prospects of significant support for the pound remain weak.”
The Bank’s quarterly Inflation Report sets out the economic analysis and inflation projections which the Monetary Policy Committee uses to make interest rate decisions.
Governor Carney will then host a press conference to talk of the findings.
It takes the focus away slightly from the UK political scene, which has so far impacted the exchange rate enormously this week.
Michael previously said: “Sterling continues to be pressured by ongoing political uncertainties.
“More broadly, markets remained tentative ahead of this weekend’s crucial G20 summit.”
Meanwhile, travel money comparison website CompareHolidayMoney.com advises going online for the best rates.
“Online providers have lower overheads and you can save around £40 per £1000 spent if you buy online compared to the high street,” CompareHolidayMoney.com said.
“If you don’t want to wait in for home delivery, you can still take advantage of the online rates by using a ‘click & collect’ service that many providers supply.”
They also advise ignoring promises of zero per cent commission. “Most outlets offer this these days — and take their cut in other ways. The rate is far more important,” they said.
Lastly, consider picking your holiday destination based on where the currency offers good value.
