Pound-to-Euro Holds Near €1.14

Modified: Monday, 6 April 2026 21:31 BST - Written by Ben Hughes

STORY LINK Pound-to-Euro Holds Near €1.14

The Pound to Euro (GBP/EUR) exchange rate edged lower late last week as markets reacted to renewed volatility following fresh remarks from US President Donald Trump regarding Iran.

At the time of writing, GBP/EUR was trading around 1.1466, up 0.08% on UK Easter Bank Holiday Monday with the pairing holding close to the €1.14 handle after recent choppy movement.

The Pound weakened as UK government bond yields moved higher in response to shifting sentiment after Trump’s latest address.

In a speech delivered late last week, the US President signalled that while the conflict with Iran may be approaching its final stages, further military action remains likely in the near term.

The lack of a clear timeline, combined with warnings that Iran could face intensified strikes in the coming weeks, dampened hopes for a swift resolution.

These developments drove oil prices higher, fuelling concerns about the inflationary impact on the UK economy. In turn, this pushed gilt yields upward as markets weighed the potential need for increased government borrowing to cushion households from rising energy costs.

The Euro found modest support as investors adopted a more defensive stance in response to the uncertain geopolitical backdrop.

Additional support for the single currency came from firmer expectations that the European Central Bank may need to maintain a tighter policy stance for longer, given the risk of sustained inflationary pressures.

However, gains in the Euro were somewhat restrained due to its inverse relationship with the US Dollar, which attracted stronger safe-haven inflows following Trump’s comments.

Short-Term GBP/EUR Forecast: Post-Holiday Data in Focus

Reduced liquidity over the Easter period helped limit volatility in the Pound to Euro exchange rate, though markets are now returning to fuller participation.

Attention is likely to shift to upcoming services PMI releases from both the UK and the Eurozone.

If the data mirrors recent manufacturing figures, where UK activity was revised lower while Eurozone figures improved, Sterling could face further downside pressure against the Euro.

At the same time, developments in the Middle East remain a key risk factor. Any fresh escalation could unsettle markets and influence direction, while signs of stabilisation may help support risk appetite and steady the pairing.

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TAGS: Pound Euro Forecasts