Pound euro exchange rate: GBP ‘subdued’ amid UK covid lockdown – travel money advice | Travel News | Travel

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The pound to euro exchange rate has been “under pressure” in recent days, according to experts. With Brexit finally completed the market is finding it hard “to find a narrative to trade on”. They warned that “rangebound conditions” will likely stay for some time.

“Until it does, such rangebound conditions are likely to continue.”

George Vessey, Currency Strategist at Western Union, also shared his insight: “As the UK enters its third lockdown, growing concerns of negative interest rates to help support the UK economy are dragging the British Pound lower. GBP/USD looks on track to suffer its first weekly decline in four weeks, perhaps suggesting a short-term decline is due.

“The pound has started the new year on the defensive once again despite the positive news of a UK-EU trade deal and avoidance of a disorderly Brexit. The UK is likely already in its second recession in less than nine months and with Covid-19 cases accelerating, the economic restrictions could last longer. More fiscal support was announced yesterday by the UK chancellor and extra monetary support is becoming more likely – hence negative interest rates are back on the agenda and weighing on sterling’s valuation.

“The pound is weaker across the board this morning and over 2 percent weaker this week against the AUD, NZD and NOK. GBP/EUR is 1.5 percent lower this week and could fall below the €1.10 mark in the near future as a key trend reversal to the downside was signalled back in late November, which seems to be holding for now.”


So what does all this mean for your holidays and travel money?

Post Office Travel is currently offering a rate of €1.0667 over £400, €1.0821 for over £500, or €1.0877 for over £1,000.

The third national lockdown is now very much underway.

Travel is no longer possible.

“If you are in England, you should not travel abroad,” stated the current government advice.

“You can only travel internationally if you have a legally permitted reason to leave home.

“There are similar restrictions in place in Scotland, Wales and also some restrictions in Northern Ireland.”

Travellers are unlikely to be seeking to exchange travel money, and experts are urging jet-setters to keep hold of any foreign currency.

“If you have got hold of foreign currency in cash, I’d recommend keeping it in a drawer if you can afford to do so,” said James Lynn, co-CEO and co-founder of travel debit card Currensea.

“The exchange rate has already hit the pound badly because of the third lockdown and if you go on a holiday later in the year you’ll be hit again converting your money back into the currency you need.”

“This could mean you lose 10 to 20 percent of the value due to fees.”

He added: “To avoid this scenario, minimise the amount of cash currency you take out before travelling and use a travel debit card instead.”

Lynn advised those due to travel in January and February to not cancel their trip but amend dates instead.

“Move your flight to a later date such as in March or April, or even the Summer when travel might be possible,” he said.

“This could save you a lot of cash if you booked your original flights in the last few months when they were good value due to the uncertainty of the current situation.”

Yesterday, travel expert Simon Calder shared his words of wisdom on booking holidays in the coming year.

He urged travellers to “to talk to a real human travel agent”, most likely on the phone, and to “book a proper package holiday.”

“Because then you know you’re getting that trip that you absolutely need and deserve,” he said.

Calder also warned against booking a “DIY” holiday – when you book flights, hotels and other elements separately.

“If you’re thinking of doing a DIY holiday, which sometimes has some merits, and lots of people have been doing it, of course, I would hold off for a while,” he said.

“If you want to commit to something, make it a proper package.”

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