Euro Currency Rate Trends

Currency trends can affect the buying power of British travellers in Europe. The British pound currently has a favourable exchange rate against the Euro. There has been a lot of change in value in recent months and indications are that there will be further change. The good news is that, in the near term, some news and reports may favor the Pound.

Currency Forecasting Is Not Precise

Forecasting trends in the Euro currency rate is not an exact science; neither traders nor investors can accurately predict values of currencies. Forecasting involves two critical variables, the tracked-currency and the currency in which one expresses its value.  When forecasting the Euro currency rate in British Pounds, it necessarily involves the health and status of the British Pound. 

Currency values, like stocks on the exchanges, depend upon long-term variables such as estimates of purchasing power and on news and events that produce changes in the markets. When looking at buying power of UK travellers in Europe, it appears that upcoming reports and financial news will help.

The Currency Outlook

The current rate is favourable at .81 Pounds Sterling to one Euro. However, over the next week, this can change due to a string of influential economic reports. Favourable economic reports recently boosted the Pound against the Euro. While this data showed Eurozone growth, they also showed the trade gap between Britain and the Eurozone had narrowed substantially.

When combined with the Bank of England forecast for more growth, the Pound advanced and gained value against the Euro.  Events in England strengthened the Pound including housing reports showing a 90-day upward trend and sharp increases in prices and sales.

The near term suggests change and favourable factors for the Pound include reports from Germany and other leading Eurozone nations of declining consumer confidence, reports off growing UK consumer confidence, and an expected improvement in UK employment data. These suggest change and in favour of the Pound over the Euro.

Another set of reports on manufacturing activity also expects to show greater improvement in the UK than in the Eurozone nations, which can add a further increase in the value of the Pound.

Traveller’s Should Watch Closely

Banks and financial companies post currency exchange rates on a daily basis.  When preparing to travel one should check the Euro rate frequently. There may not be an easy way to catch the highest rates of exchange, but one may wish to avoid the low periods. For some travel activities, such as a shopping trip to Europe, the exchange rates can be significant factors.

Whatever the Euro rate at the time, be sure to get fantastic deals on your travel money with ACE-FX.


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