February 6, 2025 – Written by David Woodsmith
STORY LINK Pound to Euro Rate Slides to €1.197 on Unexpected BoE Vote Split
The Pound Sterling lost ground against the Euro on Thursday following the Bank of England’s (BoE) latest interest rate decision.
At the time of writing, the Pound Euro (GBP/EUR) exchange rate was trading at around €1.1954, down roughly 0.5% from Thursday’s opening levels.
The Pound (GBP) fell against most of its counterparts on Thursday following the Bank of England’s latest interest rate decision.
The central bank implemented a widely anticipated rate cut, reducing the rate from 4.75% to 4.5%.
However, the BoE’s voting split and the dovish tone of its forward guidance increased expectations for further rate cuts, which weighed heavily on Sterling.
The Euro (EUR) wobbled against most of its peers on Thursday after the release of two mixed economic data releases.
First, Germany, the Eurozone’s largest economy, reported its latest factory orders for December, which came in significantly higher than
expected, rising from -5.2% to 6.9%.
However, the Eurozone’s retail sales index for the same month fell short of forecasts, coming in at -0.2% instead of the predicted -0.1%.
As we look toward Friday, the Pound Euro exchange rate will likely be influenced by several key economic data releases from the Eurozone.
Germany, the largest economy in the Bloc, is set to release its latest industrial production figures and balance of trade data.
Given that both indicators are expected to show a decline in December, the Euro may end the week weaker compared to other currencies.
On the Pound’s side, there are no UK economic data releases scheduled for Friday, which could result in GBP exchange rates lacking a
clear direction at the end of the week.
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TAGS: Pound Euro Forecasts
