Despite a lack of Brexit deal being secured and the deadline just weeks away, the pound to euro exchange rate remains ‘unfazed’ according to experts. With the US closed for Labor day, little major change is expected for sterling in the next 24 hours.
However, as the week progresses, trade talks between the UK and the EU will remain in focus for traders.
While experts predict a lack of a deal could mean a huge blow for the pound, Prime Minister Boris Johnson’s attitude suggests he considers any risk carried by a no-deal Brexit as “low”.
The pound is currently trading at a rate of 1.1174 against the euro according to Bloomberg at the time of writing.
Michael Brown, currency expert at Caxton FX spoke exclusively to Express.co.uk to share his insight into the current rates.
“Sterling traded largely unchanged against the euro on Friday amid quiet trading conditions, and has been almost completely unfazed overnight by reports of a 15 October deadline for a post-Brexit trade agreement,” he said.
“This either shows that the market believes the PM is bluffing when it comes to the deadline, or that it continues to see the risks of a no-deal departure as low.
“In any case, trade talks are set to be the main driver of sterling this week, though expectations for any significant volatility today are low given that US desks will be closed for Labor Day.”
For holidaymakers jetting off in the coming weeks, keeping an eye on any relevant political developments and their subsequent impact on the exchange rate will be key.
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According to Marianne Gilmore, managing director at currency provider Moneycorp, it is also vital to monitor how the currency has fluctuated in recent weeks.
“Firstly, consider your desired currency’s previous rate fluctuations in the last month,” she said.
“From these values, budget a realistic window as to what rate you’d be willing to exchange on, bearing in mind that an additional commission fee may apply when you actually exchange your money.”
Another great way to lock in a desirable rate is by using a prepaid travel money card.
Travel money cards can be used much like a debit card while you are abroad.
“[They’re] a convenient way of ensuring great savings when you spend,” said Gilmore.
“It also prevents any last-minute panic at the airport, where prices can be higher due to additional operating cost.”
However, Gilmore advises ensuring you go with a good provider.
“When choosing your prepaid card provider,” she added.
“We’d always advise checking whether the provider charges ATM fees or card payment fees abroad, whether they allow you to lock in exchange rates online, and what currencies are available.”
The Post Office is amongst the big-name providers now offering their own travel money cards.
At the time of writing, the Post Office is selling euros at a rate of €1.0774 for amounts of £400 or more, and €1.0987 for £1,000 or more.
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