GBP/EUR Forecast: Pound Sterling "Muted" vs Euro Despite UK GDP Beat

May 15, 2025 - Written by Frank Davies

STORY LINK GBP/EUR Forecast: Pound Sterling "Muted" vs Euro Despite UK GDP Beat

The Pound Euro (GBP/EUR) exchange rate traded in a narrow range on Thursday despite UK GDP data beating forecast in March.

Official data released by the ONS showed the UK economy grew 0.2% in March from February, compared to the 0.0% that economists had predicted.

At the time of writing, the GBP/EUR was trading at around €1.1877, virtually unchanged from Wednesday’s opening levels.

While trading largely flat against the Pound (GBP), the Euro (EUR) saw modest gains against several other major currencies on Wednesday, despite a lack of fresh Eurozone data.

The single currency’s strength was largely driven by US Dollar weakness. As the Euro often moves inversely to the ‘Greenback’, the Dollar’s decline helped lift EUR exchange rates during mid-week trading.

With no major UK data releases on Wednesday, the Pound struggled to find direction and traded sideways against many of its peers.

Nonetheless, GBP drew some mild support from revised UK growth expectations, as economists at Goldman Sachs lifted their GDP forecast for the remainder of the year from 0.4% to 0.6%.


This upgrade offered a modest boost to Sterling, helping limit the Pound’s downside in an otherwise quiet trading session.

The Pound Euro (GBP/EUR) exchange rate may experience notable movement on Thursday, with both the UK and Eurozone scheduled to release high-impact economic data.

In the UK, focus will fall on the preliminary GDP estimate for the first quarter of 2025.

The economy is forecast to have expanded by 0.6% between January and March, a sharp uptick from the previous quarter’s 0.1% growth.

If confirmed, the data would signal a stronger-than-expected recovery and could offer the Pound renewed support.

Across the Channel, the Eurozone will publish two key economic indicators: Q1 employment change and March’s industrial production figures.

Both are expected to show modest improvement, which may strengthen the Euro by easing concerns over stagnation within the bloc’s major economies.

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TAGS: Euro Forecasts Pound Sterling Forecasts