Pound to Euro Exchange Rate Unmoved as Trump Sworn in

January 20, 2025 - Written by David Woodsmith

STORY LINK Pound to Euro Exchange Rate Unmoved as Trump Sworn in

The Pound Euro (GBP/EUR) exchange rate dipped on Monday despite the publication of some below forecast data from within the Eurozone.

At the time of writing, the GBP/EUR was trading at around €1.1815, down roughly 0.3% from Monday’s opening levels.

On Monday, the Euro (EUR) gained strength against most of its counterparts, even as Germany released its latest producer price index (PPI) figures.

The PPI for Germany, the Eurozone’s largest economy, showed a decline in December, dropping from 0.5% to -0.1%, contrary to the anticipated 0.3% reading.

However, despite this disappointing economic data, the Euro held its ground and even strengthened.

This resilience was largely attributed to the Euro's inverse relationship with the US Dollar (USD), which weakened on the day of Donald Trump's inauguration as the 47th President of the United States.

On Monday, the Pound (GBP) experienced minimal movement against most of its peers as a lack of significant domestic releases left the currency mostly directionless.

Despite a generally positive market mood, GBP did not capitalise on its increasingly risk-sensitive nature and remained largely muted throughout the European trading session.

Investors appeared cautious, avoiding major moves on Sterling due to the absence of economic data, and instead awaited country’s latest labour market figures, set to be released on Tuesday.

Looking ahead to Tuesday, the key factor influencing the Pound Euro exchange rate will likely be the release of the UK’s latest jobs data.

The data is expected to show that the UK’s unemployment rate remained steady at 4.3%, while the average earnings index (excluding bonuses) is anticipated to rise from 5.2% to 5.5%.

If the data meets these expectations and confirms an increase in the UK’s average earnings, GBP is likely to gain strength following the release.

On the Euro side, Germany is scheduled to publish its latest Zew economic sentiment index for this month, which is forecast to show a slight decline.

Should the data come in as expected and indicate a drop in economic sentiment, the EUR could face pressure and potentially weaken as we move into Tuesday’s European trading session.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: Pound Euro Forecasts