Pound Hits Strongest Versus Euro in 7 Months, as Brexit Deal Agreed
Welcome to Pure FX’s latest update of the pound to euro exchange rate. This tells you when it’s a top time to exchange pounds to euros, for your money transfer!
Sterling jumps for joy versus the common currency! The pound to euro exchange rate has hit its highest in 7 months in the past day, or since April 18th, at 1.1548.
As a result, it’s an excellent time to transfer money from the UK to Europe, whether you’re buying a holiday home in France or Spain, or for your business.
By comparison, back on August 29th, sterling was as low as just 1.1006 versus the euro, so it’s now risen by +4.92% or +5.5 cents. At today’s exchange rate, a £250,000 transfer into euros would be worth 288,700€, or +13,550€ more than in late August!
Sterling Climbs, as Brexit Deal Reached
The pound to euro exchange rate reached this 7-month high, because the UK and EU have reached a Brexit deal, it was announced yesterday.
France’s European minister Nathalie Loiseau said that there’s been “substantial progress” in the latest negotiations, while Ireland’s RTE national broadcaster said that there’ll be “one overall backstop” for Northern Ireland’s border.
This has boosted sterling, because this announcement greatly lifts the odds that the EU will announce a November summit for national leaders to approve the deal, ahead of the UK’s EU exit in March next year!
Pound Strengthens, as UK Wage Growth Rises
Moreover, sterling has also flown higher versus the common currency, because UK wage growth accelerated in the 3 months to September, said official statistics on Tuesday.
UK wages rose by 3.2% in September, according to the Office for National Statistics (ONS) yesterday, +0.1% above financial market forecasts, and the most since the end of 2008.
Meanwhile, UK unemployment was 4.1% in September, close to its lowest since the mid-1970s. This tells us that UK’s job market remains in fine fettle, while rising wages will spur economic growth, thereby boosting the pound!
Euro Slides, as German GDP Falls in Q3
What’s more, the pound to euro exchange rate has reached this 7-month high, because Germany’s economy contracted between July and September, it’s been announced today.
German GDP fell by -0.2% in Q3, beyond analysts’ predictions for a -0.1% drop. This is Germany’s 1st economic contraction since mid-2015, and was caused by “fewer exports”, according to Germany’s Federal Statistics Office.
Moreover, looking ahead, Germany’s economy may struggle further, as the global trade outlook is up-in-the-air. So this weakness in Europe’s largest economy has hurt the euro!
Pound May Climb Further, as UK Inflation Set to Rise
Looking ahead, sterling could exceed this 7-month high versus the euro. This is because it’s thought that UK inflation rose to +2.5% in October compared to a year ago, above September’s figure of +2.4%, ahead of government data released today.
If so, this will pile pressure on the Bank of England to lift UK interest rates above their current 0.75%, to bring down rising price pressures.
In addition, the pound to euro exchange rate may also rise, as the Eurozone’s Q3 GDP growth may be confirmed at a measly +0.2% later today, with industrial production thought to have fallen too.
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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 firstname.lastname@example.org.
Posted by PureFX 14 Nov. 2018