Pound to Euro Forecast: GBP Close to 7-Week Best on Ukraine Fears

May 27, 2025 - Written by Tim Boyer

STORY LINK Pound to Euro Forecast: GBP Close to 7-Week Best on Ukraine Fears

The Pound to Euro exchange rate (GBP/EUR) briefly dipped below 1.1900 in Asia on Monday amid a Trump U-turn before a recovery to 1.1915 later in the day and close to 7-week highs.

Trading volumes were inevitably thin given UK and US market holidays.

On Friday, President Trump threatened to impose 50% tariffs on EU exports to the US from June 1st.

Trump stated that the US-EU trade talks were going nowhere which prompted the threat.

EU Commission President von der Leyen stated over the weekend that the EU needed more time.

Europe is ready to advance talks swiftly and decisively. To reach a good deal we would need the time until July 9th.

In response, Trump has now stated that the 50% tariff threat will be delayed until July 9th.


The delay will provide initial relief for the Euro-Zone economy and helped support the Euro, although there was still a high degree of uncertainty.

Swissquote Bank senior market analyst Ipek Ozkardeskaya commented; "One thing is for sure, whatever is said has to be taken with a pinch of salt because the narrative changes so fast. So whatever is true right now may not be true in about 10 minutes."

The UK has managed to negotiate tariffs on exports to the US down to the 10% baseline which will offer some Pound protection on trade grounds.

There are other factors which should provide net support to the Pound.

Trump’s U-Turn has triggered another rebound in global equities. UK markets are closed for a holiday, but FTSE 100 index futures are trading around 0.7% higher amid a rebound in risk appetite.

Scotiabank commented; “Risk sentiment has picked up a little in response, with European stock and US equity futures firmer.”

Overnight, Russia also launched a barrage of missile and drone strikes on Ukraine which will have some negative Euro impact with European gas prices watched closely on Tuesday.

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TAGS: Pound Euro Forecasts