Sterling stumbled to fresh eight-month lows against the euro on Friday, as global markets reeled from renewed volatility and risk-off sentiment. The Euro outshone its peers across the board, capitalising on broad weakness in other major currencies — including a brief comeback by the US dollar.
Sterling Slides, Euro Dominates
The GBP/EUR exchange rate dropped by as much as 1% on Friday, dragged down by risk aversion and a resilient euro. The single currency surged even more impressively against risk-sensitive currencies like the Australian dollar, which tumbled over 4% at its lowest point.
The sharp moves reflect growing investor caution as global economic headwinds mount — from escalating trade tensions to central banks’ hawkish stances.
Could the Euro Rally Reverse?
While the euro is currently enjoying a strong run, its trajectory could be challenged in the coming days. A looming tariff confrontation between Brussels and Washington would likely dent euro sentiment and potentially give Sterling some much-needed breathing space.
As ever, politics and international relations remain a key driver in the FX markets — and traders will be closely watching for any policy announcements or rhetoric from either side.
UK GDP Report Could Be a Gamechanger
Looking ahead, all eyes will turn to the UK’s February GDP report, due later this week. Any signs that the economy has stalled could limit Sterling’s recovery potential, especially as the country grapples with persistently high interest rates and subdued business confidence.
With April’s fiscal changes on the horizon, investors are cautious about the UK’s short-term economic outlook — a factor that could keep GBP/EUR under pressure for now.
Manage Risk, Seize Opportunities
As the FX market becomes more unpredictable, having the right currency strategy is crucial for protecting your bottom line. Whether you’re hedging exposure or taking advantage of market swings, our Qumoney specialists can help you make confident decisions.
Speak to our team today to learn how to protect your international payments and turn volatility into opportunity.