Pound to Euro Week-Ahead Forecast: GBP Struggles Below 1.15

Modified: Monday, 13 April 2026 07:01 BST - Written by David Woodsmith

STORY LINK Pound to Euro Week-Ahead Forecast: GBP Struggles Below 1.15

The Pound to Euro exchange rate (GBP/EUR) has struggled to sustain gains above 1.1500, with the pair drifting back towards 1.1480 as markets reassess Bank of England policy expectations.

With rate hike pricing being scaled back and energy-driven volatility still shaping sentiment, analysts warn that Sterling could remain under pressure in the near term.

GBP/EUR Forecasts: Damage report

Nomura is still backing Pound to Euro (GBP/EUR) exchange rate losses to 1.1170.

According to Nomura; “On GBP, we see excessive BoE rate hike pricing with policy already restrictive
and slowing wage growth already keeping inflation in check.”

CIBC sees scope for more modest losses to 1.1360 by the end of 2026.

GBP/EUR edged higher to around 1.1480 during the week after failing to hold a move above the 1.1500 level.

Stronger risk conditions helped underpin the Pound while the Euro and Sterling both derived support from the slide in oil prices. There were no major data releases during the week.

CIBC considers that traders have unwound long Euro positions; “Although the eurozone is not as exposed as the UK in terms of energy related dynamics, the legacy of the current crisis has proved to be a driver of an aggressive unwind in previously exaggerated real money EUR positions.”

The bank does see scope for a renewed build in long Euro positions later in the year.

Bank of England (BoE) policy will remain a key element, especially with sharp moves in market expectations over the past few weeks.

As energy prices declined, markets moved to price in just over one BoE rate hike for this year compared with three hikes priced in last week.

According to Nomura; “From a cyclical, interest rate perspective there appears to be limited
prospects for the BoE to match market pricing for hikes in the months ahead.

The bank noted comments from Governor Bailey and added; “As the most likely swing voter between the hawks and doves, these comments suggest a high bar for him to flip to deliver hikes.”

ING also sees scope for yields to move against the Pound; “EUR rate expectations may prove sticky, while Bank of England dovish repricing could come through more smoothly if energy prices keep declining. After all, the BoE was already ready to cut before the war began, and we have a conviction view that second‑round effect risks in the UK are significantly lower than in 2022.”

Nordea expects several ECB rate hikes this year; “While the ceasefire news immediately tilted the risks to our new ECB baseline to the downside, the outlook remains fraught with uncertainty, while signs of broader price pressures have already started to emerge.”

It added; “It is thus not at all given that an end to the war would remove the need for the ECB to tighten policy altogether, even though the conflict in the Middle East has no doubt been the trigger for expectations of near-term ECB rate hikes.”

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: Pound Euro Forecasts