Pound-to-Euro Rate Flat after Mixed German Data

Modified: Wednesday, 25 February 2026 16:01 BST - Written by David Woodsmith

STORY LINK Pound-to-Euro Rate Flat after Mixed German Data

GBP/EUR Forecast: The Pound Euro (GBP/EUR) exchange rate moved without clear direction on Wednesday, with the single currency subdued after a mixed batch of data from Germany.

At the time of writing, GBP/EUR was trading at €1.1465, leaving the pairing little changed overall from its opening levels.

The Euro edged lower early on Wednesday after fresh figures from Germany, the Eurozone’s largest economy, fell short of expectations.

Data showed German consumer confidence weakened heading into March, with the index slipping from -24.2 to -24.7. Economists had forecast a modest improvement to -23.1, so the unexpected deterioration weighed on sentiment toward the single currency.

That said, the Euro’s losses were contained. Germany’s final gross domestic product reading, published alongside the confidence data, confirmed that the economy returned to growth in the fourth quarter of 2025, offering some reassurance to investors.

Developments surrounding Russia and Ukraine also helped keep EUR movement relatively muted. While the conflict remains unresolved, ongoing US-led negotiations have raised cautious optimism that diplomatic efforts will persist, limiting sharper downside pressure on the common currency.

The Pound traded in a narrow range, with a sparse UK economic calendar offering little impetus for movement and political nerves keeping investors cautious.

Attention remained fixed on the upcoming by-election in the Greater Manchester constituency of Gorton and Denton. The vote is widely viewed as an important barometer for the governing Labour Party and for Prime Minister Keir Starmer, who has faced persistent murmurs of a potential leadership challenge in recent months.

With the result carrying possible political consequences and no domestic data releases to anchor sentiment, Sterling traders appeared reluctant to take decisive positions, leaving the Pound directionless through the midweek session.

Short-Term GBP/EUR Forecast: Eurozone Data in Focus

The Euro could take its initial cues from a speech by European Central Bank President Christine Lagarde at the start of Thursday’s session. Any fresh signals on interest rates or the broader outlook for the Eurozone economy may prompt movement in the single currency.

Attention will then centre on the Eurozone’s economic sentiment index for February. Forecasts point to a slight uptick in confidence. If confirmed, the improvement could lend the Euro modest support, particularly if it reinforces the view that the bloc’s downturn is stabilising.

For the Pound, the spotlight remains on domestic politics. With voters in Gorton and Denton heading to the polls, Sterling may struggle to find clear direction. Given the by-election’s perceived importance for the ruling Labour Party, uncertainty around the outcome could keep GBP on the defensive as markets assess the potential political fallout.

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TAGS: Pound Euro Forecasts