Will the Pound to Euro improve this month?

Pound Euro rate improves over 2 week period

The Pound Euro rate has now improved after the mini-budget disaster almost two weeks ago caused chaos for Sterling.

The Pound Euro rate was trading above 1.15 for a brief period of time earlier this week before slowing losing some of its recent gains.

The Chancellor said on Monday that he wants to boost growth as well as cutting taxes.

With parliament due to return on 11th October we could see further movements for GBPEUR rates depending on the reaction.

The new fiscal plan is due to be announced on 23rd November. Hopefully, after some review by the Office for Budget Responsibility we could some calming of the markets later next month.

Bank of England and interest rates

The Bank of England had its hand forced by the mini-budget which meant that it had to support pension funds who were at risk following the statement made by the Chancellor.

The Bank of England are expected to keep raising interest rates for the foreseeable future in order to combat inflation which has been hitting close to 10% recently.

The target for inflation is 2% so the typical way of reducing inflation is to raise interest rates.

However, as inflation has been caused by the pandemic as well as the issues in Ukraine it will be difficult to see inflation come down as quickly as the central bank would like.

The mortgage market in the UK also came under a lot of pressure with many mortgages being pulled off the market.

This has caused problems for lots of borrowers at a time when energy prices are also rising.

Tomorrow Bank of England member David Ramsden will be speaking so keep a watch out for his comments.

This may provide further insight as to what is happening with policy and therefore GBPEUR rates.

If you would like a free quote when sending Euros then please contact me directly Tom Holian [email protected]