Welcome to Pure FX’s latest update of the pound to euro interbank exchange rate.
This tells you when it’s a favourable time to exchange pounds to euros, for your money transfer!
Sterling jumps higher versus the common currency! The pound to euro interbank exchange rate has hit 1.1434 in the past day, close to its highest in 9 months, or since June 7th 2017.
The pound is strutting its stuff against the euro, because German investor confidence unexpectedly fell much more than forecast in March, said a closely-watched survey yesterday.
The euro has lost out, because according to economics watchdog ZEW on Tuesday, confidence among German investors dropped to 5.1 this month, well below market predictions for 13.0.
This has weakened the euro, because this German investor confidence figure is the lowest since the UK’s vote for Brexit in June 2016, and stems from fears of Donald Trump’s protectionism.
According to ZEW, German investors are being “more cautious in their prognoses”, following President Trump’s remarks that he could impose tariffs on EU cars, thus dragging on the euro.
Germany has a very export-orientated economy, and so stands to really lose out if President Trump wages a trade war against the EU, thereby weighing down the euro!
Pound strengthens, as UK cost of living squeeze eases
Moreover, the pound has also neared this 9-month high versus the euro in the past day, because the UK’s cost of living squeeze is easing, said official statistics yesterday.
Sterling has risen, because UK inflation fell to 2.7% in February, according to the Office for National Statistics on Tuesday, well below January’s figure of 3.0%, plus forecasts for 2.8%.
This has boosted the pound, because this brings UK inflation closer to the UK’s latest wage growth figures of 2.5%. This tells us that price pressures for Britons are now easing.
Furthermore, it’s forecast that UK wage growth accelerated to 2.6% in the 3 months to January. If so, this would further ease the cost of living for Britons too, thus lifting up sterling.
The UK’s cost of living falls when UK wage growth rises faster than inflation, because this way Britons’ earnings are rising faster than prices, thereby boosting the pound.
As a result, the pound to euro interbank exchange rate has neared this 9-month high in the past day, and may rise higher!
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Please bear in mind, this article is Pure FX’s opinion only and does not constitute advice. Moreover, the exchange rates referred to in this article are the interbank rates, which are the rates at which banks and financial institutions buy and sell currency to each other. Therefore these exchange rates cannot be accessed by individuals or SMEs, and are not the same rates that Pure FX can offer. To get a free exchange rate quote, call us on +44 (0) 1494 671800, or email [email protected]