Pound to Euro Forecast Today: GBP/EUR Slips despite Growing ECB Rate Cut Speculation

January 24, 2025 - Written by Tim Boyer

STORY LINK Pound to Euro Forecast Today: GBP/EUR Slips despite Growing ECB Rate Cut Speculation

The Pound Sterling (GBP) was subdued against the Euro (EUR) on Thursday despite a rise in European Central Bank (ECB) interest rate cut bets.

At the time of writing, the Pound Euro (GBP/EUR) exchange rate was trading at around €1.1832, virtually unchanged from Thursday’s opening levels.

On Thursday, the Euro (EUR) remained largely unchanged against most of its counterparts, struggling to gain traction as speculation mounted over potential interest rate cuts by the European Central Bank.

On Wednesday, ECB policymaker Yannis Stournaras suggested that the central bank might need to expedite its rate cuts this year if Donald Trump imposes tariffs on the Eurozone.

With speculation on the rise and a dearth of economic data from the Eurozone, EUR exchange rates continued to face headwinds.

On Thursday, the Pound (GBP) had a tough time gaining ground against its major peers, as a lack of new domestic data left exchange rates directionless.

Without fresh economic indicators, the Pound remained exposed to ongoing concerns about the UK's fiscal stability.

The day before, the UK's latest borrowing figures came in much higher than anticipated, putting significant pressure on the currency.

With no new developments on Thursday, the Pound struggled to recover from Wednesday's decline, failing to attract significant investor interest.

GBP/EUR Exchange Rate Forecast: UK and Eurozone PMIs in the Spotlight

Looking ahead to Friday, the main factor influencing the Pound Euro exchange rate will likely be the release of the preliminary PMI data for January from both the UK and the Eurozone.

For the Pound, if the UK's crucial services sector shows another decline this month, it could dampen Sterling's performance by the end of the week.

As for the Euro, the Eurozone's latest PMI data is expected to report another mixed result, which could also put pressure on the single currency on Friday.

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TAGS: Pound Euro Forecasts