Last week the exchange rates continuously fell and remained low due to an uncertain Brexit.
With the EU yet to decide if the UK would remain in the single market the outlook wasn’t too promising.
The pound to euro exchange has a brighter outlook this morning following a new report published yesterday.
At 7.30am this morning the rate rose to 1.1355 according to the latest Bloomberg figures.
TorFX currency analyst Laura Parsons said: “GBP/EUR exchange rate was driven higher on Tuesday as an upbeat Brexit report gave the pound a shot in the arm.”
Talks about the future post Brexit are to blame for the rise, as rumours about the UK’s position within in the EU are questioned.
Laura explains Sterling surged across the board on rumours that the European Parliament is working on plans that would give the UK privileged access to the single market after Brexit.
Having access to the single market is good news for the GBP/EUR exchange rate.
New Brexit report drives exchange rate higher
Exchange rate rose to 1.1355 according to the latest Bloomberg figures.
Improved employment figures will also drive exchange rates higher, giving the sterling an edge over the euro.
“GBP/EUR advanced beyond €1.133 ahead of the release of the UK’s latest employment figures and encouraging wage growth data could drive the pound higher still,” said Laura.
This follows last week’s fall in which The Post Office was offering €1.0982 to the pound, an exchange rate that was a recorded new low for sterling against the euro.
Although the exchange rate is rumoured to be driven higher, average earnings are not expected to rise.
Rumoured plans to give UK privileged access to the single market
“Current forecasts are for no change in average earnings so Sterling may struggle to maintain its upwards momentum today,” comments Laura.
This follows news at the beginning of the week of fall in the German currency and the euro.
If this continues and the euro carries on falling, this could help edge the pound higher.
Ms Parsons said: “The German expectations and current situation gauges are expected to decline in February, and such results could help the pound edge higher against the euro.”