THE POUND to euro exchange rate has suffered a low week, with general election uncertainty and a bleak outlook from the Bank of England baring a heavyweight on sterling. With many Britons looking forward to winter holidays, how will the exchange rate fare for their travel money?
The pound to euro exchange rate has suffered a week of struggles, as the general election campaigns got underway and the Bank of England announced its latest policy changes. Sterling has seen a series of highs and lows in recent months thanks to Brexit, however with the EU departure at a stagnant point the GBP is struggling to regain strength. The announcement of a general election on 12 December points to an uncertain future for the UK, and the pound has responded with a declining rate.
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The pound is currently trading at a rate of 1.1594 against the euro according to Bloomberg at the time of writing.
Michael Brown, Senior Market Analyst at , said: “Sterling struggled on Thursday after a dovish Bank of England struck a downbeat and cautious tone on the economy and the policy outlook, with two MPC members even voting in favour of an immediate 25bps rate cut.
“Today, focus will remain on political developments, with no major economic releases due. The pound may suffer some weakness, however, as market participants trim positions ahead of the weekend.”
READ MORE: Martin Lewis: Money saving expert reveals top tip for spending money abroad on holiday [INTERVIEW]
Pound to euro exchange rate: The general election is causing jitters for the pound (Image: Getty Images)
Yesterday the Bank of England announced its latest policy changes.
Amid political nervousness, the bank poised a bleak forecast for the future.
Pointing the finger at both Brexit-related uncertainty and global slowdown the central bank said underlying UK growth had “slowed materially” this year, affecting both business investment and consumer spending, according to the Financial Times.
The bank slashed its economic growth forecast for 2021 from 2.3 percent to 1.8 percent.
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However, policymakers also stressed the positive effects a successful deal will have on Britain’s financial future.
This has been reflected in the status of the pound since the announcement of Brexit in 2016.
Though the promise of a ‘deal’ has seen the pound claw its way to a more comfortable rate, the threat of a ‘no deal’ has seen it plummet in quick succession.
Pound to euro exchange rate: The pound is currently trading at a rate of 1.1594 (Image: Bloomberg)
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Pound to euro exchange rate: Brexit election uncertainty weakens GBP
So, what does this all mean for holidaymakers looking to change their money?
For Britons jetting off in the near future, the Post Office is currently offering a rate of $1.1253 for £400 or more, or a rate of $1.1427 for £1,000 or more.
While the exchange rate is never simple to predict, travellers can do their bit by keeping up-to-date on developing news stories and political changes.
If rates are looking particularly good, plan ahead and change your money in advance.
Pound to euro exchange rate: Martin Lewis advises using a specialist travel money card (Image: Getty Images)
Money Saving Expert Martin Lewis also offers some top tips for making the most of spending abroad.
He explains: “If you normally spend abroad on debit or credit cards, while the providers get near-perfect rates, most add an up to three per cent ‘non-sterling exchange rate fee’ on top – meaning something that costs £100 costs you £103.
“Yet specialist overseas credit cards don’t add that fee, so you get the same near-perfect exchange rate as the providers – smashing bureau de change – in every country, every time you go away.
“Just ensure you pay the card off in full each month to minimise the interest.”
