Pound to euro exchange rate slumps as rate at mercy of coronavirus – should you buy euros?

The pound to euro exchange rate suffered from the ongoing stalemate over a post-Brexit deal last week. Friday saw GBP slump as the latest round of talks concluded with no real progress. So could the final week of August see sterling rise once again?

According to experts, the week ahead is all quiet on the data front.

The coronavirus crisis continues to heavily impact the exchange rate.

Therefore, the pound “is likely to take its lead from shifts in risk appetite on a global level.”

The pound is currently trading at 1.1100 against the euro, according to Bloomberg at the time of writing.

Michael Brown, currency expert at international payments and foreign exchange firm Caxton FX, spoke to Express.co.uk regarding the latest exchange rate figures this morning.

“Sterling lost ground on Friday, being pressured by the continued stalemate over a post-Brexit trade deal as the latest round of talks concluded – as expected – with no significant progress towards an agreement.

“This week, given the quiet data calendar, the pound is likely to take its lead from shifts in risk appetite on a global level, which are contingent largely on news flow surrounding the coronavirus pandemic.”

The good news for British holidaymakers in 2020 is that, surprisingly, the pound is stretching further this year.

The Post Office’s sales of the euro are bouncing back after lockdown eased, the Post Office Travel Money Holiday Money Index of 2020 revealed this month.

Euro purchases on its Travel Money Card in July surged to 10 times the level prior to the start of the lockdown period.

What’s more, the euro heads Post Office Travel Money’s 20 top-selling currencies for July covering countries on the government’s list of ‘safe’ destinations for UK travellers.

In its Exchange Rate Monitor analysis of rate movements, the Post Office found that sterling is stronger year-on-year against all 20 of the bestselling currencies whose countries are on the Government approved list.

Those visiting eurozone countries will have almost £14 more cash in hand.

But talking of cash, is it better to buy your foreign currency in notes and coins or is on card better?

“Many of our customers are especially wary of using cash abroad now,” James Lynn from Currensea, who has launched a travel card that links directly to your bank account, told Express.co.uk.

“Although UK providers may offer new or clean notes, fear exists about the cleanliness of receiving change when spending abroad, where notes and coins can have passed through tens of hands in a single day.

“Given these perceived health risks, the security challenges around carrying cash, and the lack of protection on cash spend, our advice is to minimise cash use where possible and stick to the safety of card-based spend,” recommended Lynn.

He added: “Using a travel card will always be a safer and cheaper option than using cash.

“The best way to handle money abroad is to use a travel card and withdraw a small amount of cash if and when you need – but be sure to check if your provider charges you for ATM withdrawals to keep the cost down.”

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