Pound to Euro Today: GBP/EUR Rate Steady Amid Uncertainty Over Ukraine Peace Talks

March 17, 2025 - Written by Frank Davies

STORY LINK Pound to Euro Today: GBP/EUR Rate Steady Amid Uncertainty Over Ukraine Peace Talks

The Pound struggled for direction against the Euro on Monday as markets remained cautious ahead of high-level talks between the US and Russia regarding the ongoing war in Ukraine.

At the time of writing, the Pound Euro (GBP/EUR) exchange rate was trading at approximately €1.1894, virtually unchanged from Monday’s opening rate.

The Euro (EUR) was unable to gain any meaningful traction at the start of the week as investors adopted a wait-and-see approach ahead of talks between US President Donald Trump and Russian President Vladimir Putin.

The two leaders are set to speak on Tuesday, following diplomatic discussions over the weekend aimed at brokering a ceasefire in Ukraine.

While the potential for a peace deal would generally be viewed as positive for the Euro, uncertainty over the terms of any agreement left markets uneasy.

Trump hinted at possible territorial concessions to Russia, while Putin reiterated his opposition to any Western military presence in Ukraine. Such conditions may prove divisive, particularly among Ukraine’s European allies, leading to fears that any deal could face significant obstacles.

The Pound (GBP) faced headwinds on Monday as the Organisation for Economic Co-operation and Development (OECD) slashed its UK growth forecast for the year.

The OECD warned that escalating global trade tensions and weak domestic demand could hinder the UK’s economic recovery, downgrading its growth projections for multiple advanced economies.

For the UK, this revision reinforced existing concerns about sluggish economic expansion and added to speculation that Chancellor Rachel Reeves may be forced to introduce spending cuts in the upcoming Spring Budget.

Looking ahead, the Pound Euro exchange rate could face renewed pressure on Tuesday with the release of Germany’s latest economic sentiment index.

The March survey is expected to reflect improving business confidence, driven by optimism surrounding Germany’s increased investment in defence and infrastructure, which investors hope will stimulate growth in the Eurozone’s largest economy.

Meanwhile, the Pound may see limited movement as markets turn their focus to the upcoming Bank of England (BoE) interest rate decision later in the week, with any surprises in forward guidance potentially influencing Sterling’s direction.

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TAGS: Euro Forecasts