Pound to euro exchange rate – Sterling continues gradual rise after turbulence last week
The pound has stabilised against the euro after dropping last week
THE pound to euro exchange rate is continuing to rise after plummeting to the lowest rate since November last week.
The conversion rate is currently at €1.1401 to pound sterling after a turbulent week which saw seen it fluctuate to lows of €1.126 - and a high of €1.1408 just this morning.
It currently stands at €1.1401 - a 0.1 per cent increase from yesterday - a percentage increase of 0.0011 per cent from its pre-Brexit exchange rate of €1.1389 to the pound, according to .
The pound rallied strongly against the euro, US dollar and other currencies last week after Governor of the Bank of England Mark Carney suggested rates could rise if business investment grows.
Interest rates were slashed in August last year after the Brexit vote, causing the value of the pound against other currencies to drop.
Where is the best place to get Euros?
Euros can be bought at supermarkets, the Post Office and currency specialists - but the rates vary massively.
The best rates can often be found at specialist online outlets, such as Travelex and Moneycorp, which can deliver your cash to home.
Travellers can use comparison sites, such as MoneySavingExpert's TravelMoneyMax, to find the best rate.
If you order in advance and pick up the cash then you'll get a better rate than if you walk in.
Your can also buy last-minute currency at the airport, but expect to be hit with poor rates.
The rates you'll see above are the "spot" currency rate that is traded on the market. These are different to the rates offered by money changers - but changes in these rates do have an affect on how much cash you get.
How to get the best holiday money rate
WE spoke with Hannah Maundrell, editor-in-chief at money.co.uk to find out how you can guarantee the best rate when you go on holiday
- Don’t buy cash at the airport – you’ll always be able to beat the rate with a bit of forward planning
- Compare travel money companies online – Factor in delivery costs and choose the option that gives you the most cash to spend on holiday. If you’ve left it until the last minute order online for airport collection so you get the best of both worlds.
- Use comparison tools – MoneySavingExpert’s TravelMoneyMax enables you to compare pick-up and pre-order rates.
- Don’t pay for travel money with a credit card – it’s likely you’ll be charged a cash withdrawal fee which adds to the cost.
- Top up a prepaid card to lock in your rate now – Choose your card and read the T&Cs carefully as some apply hefty fees. WeSwap, FairFX and Caxton FX are all worth checking out.
- Always choose to pay in the local currency rather than sterling – This will help you avoid sneaky exchange fees
What is the Bank of England interest rate?
The UK interest rate – known as the base rate – is set by the Bank of England for lending to other banks and it used as the benchmark for interest rates generally.
It may affect interest you pay on loans, or receive on savings accounts. The BoE’s monetary policy committee (MPC) sets rates and has said previously that it’s in no rush to push them up.
But many economists have said that rocketing inflation could put pressure on the BoE to take action and put up rates.
Last August in the wake of the Brexit vote, policymakers voted to cut interest rates from 0.5 per cent to 0.25 per cent.
The move aimed to stimulate economic growth by encouraging people to spend.
But Mr Carney’s latest comments have been seen as a sign that interest rates may soon be raised back to 0.5 per cent.
How do interest rates affect the pound to euro exchange rate?
Reducing interest rates means it is less attractive to save money in the UK, meaning the value falls as Sterling is less in demand.
But suggestions that the Bank of England could raise the base rate again has given the pound a rocket boost.
Chief banker Mr Carney said “some removal of monetary stimulus is likely to become necessary".
He said the Bank 's rate-setters, the Monetary Policy Committee (MPC), will have to weigh up the case for a hike in the coming months, said the chief policymaker.
The MPC voted to keep the interest rates unchanged at 0.25 per cent earlier in June, but soaring inflation pushed three of its nine members to vote for a rate rise.
What other things affect the pound to euro exchange?
Foreign exchange rates are constantly changing. All the time.
One of the main factors is the economy. So, for example, when the Bank of England makes a statement or if interest rates change.
It is usually affected when the Office for National Statistics reveals inflation rates or when employment figures are announced.
The pound is also sensitive to political changes, for example, during the EU referendum or if the Prime Minister calls a snap election.
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