The pound to euro exchange rate had a couple of good weeks especially after managing to spike over the Easter weekend. Sterling has taken a hit once again after facing a downturn in risk appetite. Despite hitting above the £1.15 handle this week, it has now dropped back down to £1.14.
- Pound to euro exchange rate: GBP rockets as Boris Johnson returns home
This week, the pound experienced highs of 1.1515 and above which is a huge gain of eight percent over the course of two weeks.
But now, the pound is currently trading at a rate of 1.1469 against the euro according to Bloomberg at the time of writing.
Michael Brown, Currency Expert at Caxton FX, spoke to Express.co.uk to offer his exclusive insight.
Mr Brown said that the pound “struggled” yesterday due to a “souring” in risk appetite.
“Sterling struggled across the board yesterday, facing stiff headwinds amid a broad-based souring in risk appetite, which took the pound back below the €1.15 handle.
“Today, risk appetite will remain driven by the coronavirus pandemic, with a further deterioration in risk appetite likely to result in further headwinds for the pound.”
The pound did not just fall against the euro but also the dollar and a host of other major currencies yesterday.
The fresh anxieties come as the coronavirus death toll continues to spike in the UK.
Pound to US Dollar latest: Sterling plummets after Boris COVID update [INSIGHT]
Pound to euro exchange rate: GBP sees losses amid covid-19 [UPDATE]
FTSE 100 plummets for FIFTH week as IMF declares global recession [ANALYSIS]
The ongoing COVID-19 crisis is having an impact on daily life as most citizens in the UK remain in lockdown.
Citizens are only allowed to leave their homes for essential food items and their one hour of daily exercise a day.
UK Currency Strategist from Western Union Business Solutions George Vessey said forecasts by the International Monetary Fund (IMF) paint a bleak picture for the UK.
He said: “The dismal updated economic forecasts by the IMF paint a bleak picture for the UK, predicting the loss of output next year to be above five percent compared with October 2019 forecasts.
“The economic impact of the UK lockdown is already being felt, but should the infection rate continue to rise, it will be difficult for the government to ease restrictions, therefore exacerbating the economic problem.
“Aside from this crisis, Brexit uncertainty still hangs over the UK as the deadline to request an extension to the transition period draws nearer, putting more pressure on a UK-EU trade deal to be achieved before year-end 2020.
“Sterling’s valiant recovery has taken a hit this morning, with GBP/USD down over 0.8 percent, over 100 pips lower than the high of the day.”
“GBP/EUR has also surrendered a lot of yesterday’s gains, highlighting just how precarious these markets are amid these unprecedented times.”
Currently, there are over two million cases of coronavirus worldwide with over 134,000 deaths.
Half a million of those cases have successfully recovered, according to worldometers.
Although Europe very much remains the epicentre of the virus, the US virus rate has now soared past half a million.
The UK has almost 100,000 cases and has had 12,868 deaths.
Source: Read Full Article