Pound to Euro Today: GBP Drifts, EUR Headwinds After EZ Jobs

July 2, 2025 - Written by Frank Davies

STORY LINK Pound to Euro Today: GBP Drifts, EUR Headwinds After EZ Jobs

Update: The Pound-to-Euro exchange rate (GBP/EUR) was trapped in a narrow range on Wednesday as the Eurozone released its May unemployment reading.

At the time of writing, the GBP/EUR was trading at around €1.15676, unchanged from Thursday's opening price.

"The GBP is soft, down 0.3% vs. the USD and underperforming most of the G10 currencies into Wednesday’s NA session," said economists at Scotiabank in a client brief on Wednesday.

"Comments from BoE MPC member Taylor, a minority dove who last voted for a 25bpt cut as the majority voted to hold, have highlighted concerns about the UK’s ability to achieve a soft landing and downside risks to inflation that could require additional easing.

"Rates markets are pricing in about 56bpts of easing by year end, down adding about 15bpts over the last month or so. Markets are pricing a 90% chance of a cut for the next BoE meeting on August 7."

The Euro (EUR) faced renewed headwinds on Wednesday after the Eurozone’s latest labour market data disappointed expectations.

Investors had anticipated the bloc’s unemployment rate would hold at a record low of 6.2% in May, however, the reading unexpectedly ticked higher to 6.3%.


This surprise uptick suggested some softening in the Eurozone labour market, raising concerns about the region’s economic momentum and dampening confidence in the single currency.

As a result, the Euro struggled to find support during mid-week trade, with the weaker-than-expected data undermining demand and leaving EUR exchange rates on the back foot.

The Pound (GBP) was largely rangebound on Wednesday as a lack of fresh UK economic data left investors with little to react to.

While Sterling had come under slight pressure earlier in the week, partly due to mounting political uncertainty within the Labour party, mid-week trading saw the currency stabilise somewhat.

Despite this, the absence of any domestic data or major policy signals meant the Pound lacked direction and failed to build momentum against most major peers.

With sentiment-driven flows offering limited impetus, GBP exchange rates drifted through the session, showing little inclination to break higher or lower.

Looking ahead to Thursday’s European session, movement in the Pound to Euro (GBP/EUR) exchange rate is likely to be driven by the release of the UK and Eurozone’s finalised services PMIs for June.


For the UK, the services PMI, covering the country’s largest economic sector, is expected to show a modest improvement, rising from 50.9 to 51.3.

A print in line with forecasts would mark a three-month high and reinforce signs of steady, albeit limited, growth in the sector.

Meanwhile, the Eurozone’s services index is also forecast to improve, climbing from 49.7 to 50.0, a move that would bring the sector back into expansion territory for the first time since March (a reading over 50).

A return to growth in services activity could bolster confidence in the bloc’s economic recovery and offer the Euro some tailwinds.

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TAGS: Pound Euro Forecasts