British Pound-to-Euro Strikes Five-Week Best following UK GDP

Modified: Thursday, 14 August 2025 15:45 BST - Written by David Woodsmith

STORY LINK British Pound-to-Euro Strikes Five-Week Best following UK GDP

The Pound Euro (GBP/EUR) exchange rate climbed to a five-week high on Thursday as the UK’s latest GDP data exceeded expectations.

At the time of writing, GBP/EUR was trading at €1.1622, up 0.2% on the day.

The Pound (GBP) gained modest ground on Thursday after fresh GDP data revealed the UK economy performed better than markets had anticipated.

Official figures showed the economy expanded by 0.3% in the second quarter – a clear slowdown from the 0.7% growth seen in the first three months of the year, but comfortably ahead of forecasts for just 0.1%. June’s GDP growth of 0.4% provided a particular boost to the quarterly reading.

However, the currency’s gains were capped as the data also highlighted underlying weaknesses. Business investment dropped by 4%, and concerns linger over potential tax rises in the autumn alongside uncertainty in global trade policy.

Still, after the UK’s upbeat jobs report earlier in the week, the stronger GDP print added weight to expectations that the Bank of England (BoE) may take a more hawkish stance on interest rates.

The Euro (EUR) traded without clear direction on Thursday, with sentiment muted in the absence of fresh Eurozone data and as investors looked ahead to Friday’s meeting between US President Donald Trump and Russian President Vladimir Putin.


The high-stakes talks, set to take place in Alaska, aim to explore pathways to ending the war in Ukraine – a prospect that left EUR traders balancing cautious optimism with unease.

While a breakthrough could deliver a significant boost to European stability and the single currency, there are concerns that the summit might yield little concrete progress. Some fear that Trump could push for Ukraine to surrender territory in exchange for a ceasefire, a scenario that would generate political and market tensions across Europe.

With uncertainty overshadowing the outcome, the Euro remained largely subdued through Thursday’s session.

GBP/EUR Outlook: Trump-Putin Talks Take Centre Stage

Friday’s market focus will centre on the Trump-Putin summit, with traders bracing for potential volatility as headlines emerge from the high-profile meeting.

For the Euro, uncertainty surrounding the talks could keep sentiment subdued, while any hints or speculation about the discussions may trigger sharp intraday moves.

A decisive agreement that outlines a credible route to ending the war in Ukraine would likely buoy the single currency, easing geopolitical risks and boosting investor confidence. In contrast, stalled negotiations or proposals perceived as unfavourable to Ukraine or the EU could undermine EUR sentiment. Adding to the stakes, any indication that US-EU relations may sour in the wake of the summit could inject further instability into the Euro’s outlook.


For the Pound, a degree of profit-taking is possible after a strong performance over the week. Nonetheless, expectations of a more hawkish Bank of England stance may provide a cushion against significant Sterling losses.

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TAGS: Pound Euro Forecasts