British Pound: Sterling Was Best Performing G7 Currency Last Week – Looking Ahead, More To Come? – Exchange Rates UK

Image: euro-to-Pound exchange rate chart – Source: Saxo Bank

The Pound to Euro exchange rates rallied at the end of last week, to trade close to 2020 highs, after the Bank of England elected to keep interest rates on hold on Super Thursday.

The vote split was 7:2, something markets weren’t altogether expecting.

Pound Sterling rallied and saw a 2020 best exchange rate of €1.192 into the month-end, close to multi-year highs of 1.208 of December 2019.

The British currency ended January’s trade as the best performing currency of the G7 currencies for the last week.

“The pound rose yesterday as the Bank of England decided to leave interest rates at 0.75%, in line with our central call, although the decision was considered to be a close call” say analysts at Lloyds. “In early trading, it has risen above $1.31 and €1.19. The pound has been the strongest-performing G7 currency so far this week.”

EUR/GBP (Inverse of GBP/EUR) Could challenge Post-December Election Spike Lows

“Sterling is surging to new local highs in some of the crosses, and EUR/GBP is looking at the January lows this morning” says John Hardy, Head of FX Strategy at Saxo Bank Group.

“Carney’s swan song failed to bring the rate cut that was perhaps a bit more favoured than reflected in recent expectations surveys due to the coronavirus outbreak.

“The MPCs hold out hope that the recent surge in surveys is a sign of better things to come.

“We are a bit taken aback by sterling’s ability to power higher despite all of the uncertainty elsewhere, but respect the move at face value as we watch whether the key benchmark EUR/GBP can poke and hold below the prior lows and go on to challenge the post-December election spike lows.”

See latest GBP/EUR exchange rates, charts and historical data here.