The pound to euro exchange rate is on a rising streak – with experts suggesting sterling will remain “well-supported” until political change occurs. Sterling was boosted yesterday in a rare moment of joy for holidaymakers and currency traders. This might indicate they should switch their GBP to euros now, in order to take advantage. The pound is currently trading at 1.122 against the euro, according to Bloomberg.
Michael Brown, of Caxton FX, analysed the small rise, which came as quite a surprise.
Speaking at the mid point of the week, he said: “Sterling firmed against the euro on Tuesday, adding a shade under 0.2 per cent as better than expected labour market data and hawkish comments from Bank of England policymakers underpinned the pound.
“Data showed the UK’s labour market remaining tight and close to full employment, despite a slight softening from the previous release, with wages increasing at 3.1 per cent and unemployment remaining at a multi-decade low of 3.8 per cent.
“Meanwhile, several BoE policymakers commented that interest rates may increase faster than the current market pricing implies, though MPC members’ hands remain tied by Brexit-linked uncertainties.
“The day ahead sees little in the way of major releases on either side of the Channel, meaning focus is likely to remain on the ongoing Conservative Party leadership contest, ahead of tomorrow’s first round of voting.”
He added: “Despite the pound remaining relatively well-supported at present, any significant upside movement is unlikely until a degree of political uncertainty has dissipated.”
The Conservative party leadership votes will see the next leader of the party elected, following current Prime Minister Theresa May’s choice to stand down officially last week.
Whoever wins the election will consequently be the next Prime Minister.
The small rise will be a great relief to holidaymakers, who have seen the exchange rate fluctuate massively during this year’s chaotic Brexit negotiations.
Sterling has also never reached the levels seen prior to the 2016 Brexit referendum.
Meanwhile, yesterday Express.co.uk reported how Britons could be forced to show their holiday currency at border control after the UK separates from the EU.
These FCO guidelines include one particularly unexpected stipulation, which many will have not realise.
It relates to the documents needed at border control – and, surprisingly enough is nothing to do with passports.
Instead, as well as a passport, Britons will need to show a return or onward ticket.
Yet the curveball which will now feature in a post-Brexit travel climate is that travellers now need to “show you have enough money for your stay”.
The FCO website stipulates: “Border control: you may have to show your return ticket and money.
“There will be other changes from 31 October 2019 if there’s no deal.”
It added: “At border control, you may need to show a return or onward ticket, show you have enough money for your stay and use separate lanes from EU, EEA and Swiss citizens when queueing.”