Pound to Euro Exchange Rate Smashes 2024 Best

December 11, 2024 - Written by David Woodsmith

STORY LINK Pound to Euro Exchange Rate Smashes 2024 Best

At the time of writing, the GBP/EUR was trading at around €1.2117, up roughly 0.3% from Tuesday’s opening levels.

On Tuesday, the Euro (EUR) declined against most of its peers, largely due to the absence of domestic data releases and a strengthening US Dollar (USD).

With no economic data from the Eurozone to influence trading, EUR exchange rates were mainly guided by market sentiment.

However, even though a risk-off market mood typically supports the safe-haven Euro, the Euro's appeal was diminished by the rising USD, another primary safe-haven currency, due to their negative correlation.

On Tuesday, the Pound (GBP) traded mostly sideways against the majority of its peers, as the ongoing lack of UK data releases left Sterling without a clear direction.

Despite the absence of economic news and a cautious market mood, GBP exchange rates managed to stay stable.

Sterling, which is increasingly sensitive to risk, usually benefits from positive trading conditions.

However, even without these favourable factors and with no new data to influence it, the Pound maintained its position.

GBP/EUR Exchange Rate Forecast: Eurozone Interest Rate in the Spotlight

Looking ahead, the primary catalyst of movement for the Pound Euro exchange rate beyond Wednesday is the upcoming ECB interest rate decision, set to be released on Thursday.

Markets are anticipating another 25-basis point cut this week, which could lead to the Euro weakening against other currencies due to the continued easing of the ECB's monetary policy following October's 25 basis point rate cut.

For the Pound, the UK economic calendar is fairly light this week, suggesting that GBP exchange rates will likely be more affected by overall market sentiment.

If the negative risk appetite seen on Tuesday persists, the Pound could also decline against its peers.

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TAGS: Forecasts