Pound to euro exchange rate: Sterling ‘drops back’ after latest ECB comments.
POUND to euro exchange rate: Sterling lost gains made earlier in the week after the European Central Bank discussed changes to its quantitative easing program, leading to an uptick for the eurozone currency.
The pound to euro exchange rate sits at 1.1387 as of 9am this morning, according to data released by Bloomberg.
Despite starting the week positively, sterling managed to lose the ground it had gained.
This was due to the euro being bolstered by comments made by European Central Bank chief economist Peter Praet.
He implied the ECB will consider tapering its quantitative easing program at an upcoming policy meeting.
Speaking to Express.co.uk, Laura Parsons, currency analyst at TorFX, said: “The GBP/EUR exchange rate shed all of Tuesday’s gains yesterday, dropping back to €1.138 after comments from the European Central Bank (ECB) chief economist Peter Praet bolstered the euro.
“Praet intimated that the ECB will discuss tapering its quantitative easing program at its June policy meeting, leading to broad-based euro gains.”
Looking to the week ahead, Laura continued: “The GBP/EUR exchange rate may hold its weaker position ahead of today’s Bank of England (BoE)/TNS inflation attitudes survey. The Eurozone’s final growth data will also be of interest.”
Today’s news comes after sterling had been enjoying a positive week.
Yesterday, British currency stood at 1.142, with good figures thanks to trading in the private sector.
Trading figures were revealed by a good forecast for UK services Purchasing Managers' Index (PMI).
Speaking yesterday, Laura Parsons, currency analyst at TorFx, said: “The pound finally enjoyed a solid day of trading on Tuesday, advancing across the board in reaction to better-than-forecast UK services PMI.
“The measure of the UK’s all-important services sector rose from 52.8 to 54.0, pushing the GBP/EUR exchange rate to a high of €1.142.
“With this sign that the UK economy recovered ground at the start of the second quarter, hopes for a near-term interest rate increase from the Bank of England (BoE) rose, and the pound rose along with them.”
Laura also explained there could have been further gains for the pound, and continued: “The pound could extend gains against the euro today if the Eurozone’s retail PMI shows a contraction in consumer spending.”
However, it wasn’t to be, and today the pound has dropped down from its higher position.
A strong exchange rate can make the pound go much further for British travellers when it comes to buying foreign currency.
To get the most for the pound, tourists can avoid a number of traps that mean getting less for their money.
Laura Parsons has previously explained that using a bank that doesn’t offer “the most competitive fees” when moving money around could cause a loss in exchanging money.
The airport should also be avoided when getting foreign currency before a holiday.
Airport exchange rates have hit lows of 90 cents against the pound.