THE POUND to euro exchange rate took a slight dip compared to the previous day ahead of the Bank of England’s looming decision whether or not to cut interest rates. How will this affect Britons?
The pound to euro exchange rate took a slight dip today, trending at 1.1832€ at the time of writing compared to 1.1843€ the previous day.
The figure is relatively unchanged and it’s likely the pound will trade quietly until the Bank of England’s policy decision on Thursday, which could impact exchange rates.
Michael Brown, Senior Market Analyst for Caxton FX, told Express.co.uk: “Sterling remained range bound as a fresh trading week got underway yesterday, with no major headlines or impactful data releases to drive the pound.
“Instead, market participants remain focused on Thursday’s coin-flip BoE policy decision, hence sterling should trade quietly ahead of the rate announcement.”
The BoE will make its policy decision on Thursday, with many paying close attention to the tone the bank takes.
“A key input in the decision is how uncertainty unwinds going forward, and how that impacts on demand,” said Ms Tenreyro.
“We will be watching very closely how firms and households respond to Brexit developments.
“We are talking about the coming months, or I am talking about the coming months, on the possibility of further stimulus.”
Her points were followed by BoE policymaker Gertjan Vlieghe, who told the Financial Times he will consider voting for a rate cut depending on how the economy has performed since the election in December.
“It doesn’t take much data to swing it one way or the other and the next few [MPC] meetings are absolutely live,” he said.
“I really need to see an imminent and significant improvement in the UK data to justify waiting a little bit longer.”
As the UK anticipates BoE’s decision on Thursday, what does this mean for British holidaymakers?
The Post Office is currently offering a rate of €1.1417 for over £400 and €1.1642 for over £1.1497.
And as the UK prepares to leave the EU this week at 11pm GMT on Friday, January 31, 2020, many Britons will be happy to know that during the transition period all current rules on travel to the EU will remain the same as they are now.
This means all holiday plans and other travel to Europe will be unaffected for 2020, and your passport will be valid.
ABTA travel association said: “If Parliament ratifies the Withdrawal Agreement before 31 January 2020, which it is on track to do, the UK will enter a transition period, meaning everything will remain the same and you can continue to travel as you do now until at least the end of December 2020.”
As long as your passport is valid for the whole of your trip, you will be able to use it under the transition period.
You do not need to have six months left on your passport to travel to the EU during the transition period, according to ABTA.
There will be no changes to EHIC cards, driving licences, data roaming or taking pets abroad under the transition, as the UK will still technically be an EU member state.
However, what happens after the transition period remains to be seen.