Pound-to-Euro Rate Subdued as Germany Release September PPI

Modified: Monday, 20 October 2025 22:17 BST - Written by Frank Davies

STORY LINK Pound-to-Euro Rate Subdued as Germany Release September PPI

The Pound Euro (GBP/EUR) exchange rate was largely unchanged on Monday as markets reacted calmly to Germany’s latest producer price index (PPI) figures.

At the time of writing, the GBP/EUR was trading around €1.1512, virtually flat from Monday’s opening levels.

The Euro (EUR) held its ground against most of its major counterparts on Monday, showing resilience despite the release of underwhelming data from Germany, the Eurozone’s largest economy.

September’s German producer price index revealed that factory gate prices fell for a seventh consecutive month, highlighting ongoing weakness in the country’s industrial sector.

Although the figures showed a slight improvement – rising from -2.2% to -1.7% – the continued decline underscored the subdued inflationary pressures within the bloc’s manufacturing base.

Nevertheless, the Euro remained broadly stable throughout Monday’s European session, as investors largely shrugged off the disappointing report and instead maintained focus on this week’s upcoming Eurozone inflation data.

The Pound (GBP) also moved in a tight range against the majority of its peers on Monday, lacking a clear sense of direction amid a quiet start to the week for UK data.

With no fresh domestic releases to drive movement, Sterling traded without conviction as investors opted for a cautious approach ahead of key mid-week releases, including the latest UK consumer price index (CPI) and retail sales figures.

As a result, the Pound drifted sideways through Monday’s European session, struggling to gain traction against its major counterparts.

GBP/EUR Forecast: Market Sentiment to Set the Tone

Looking ahead to Tuesday’s European session, the Pound Euro (GBP/EUR) exchange rate is likely to be guided primarily by shifts in broader market sentiment, with no high-impact releases due from either the UK or Eurozone.

If investors turn risk-averse, the Euro may benefit from its relative safe-haven appeal, potentially exerting modest downward pressure on the GBP/EUR pairing.

Conversely, if global markets adopt a more optimistic tone, the risk-sensitive Pound could edge higher, allowing the exchange rate to recover modestly as the session unfolds.

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TAGS: Pound Euro Forecasts