British Pound to Euro Forecast: GBP Tests 1.15 Resistance, Defying Bears

Modified: Wednesday, 15 April 2026 08:46 BST - Written by Tim Boyer

STORY LINK British Pound to Euro Forecast: GBP Tests 1.15 Resistance, Defying Bears

The Pound to Euro exchange rate (GBP/EUR) pushed above 1.1500 to two-week highs near 1.1510, as Sterling continued to defy bearish expectations amid improving risk sentiment and supportive yield dynamics.

However, with resistance building above 1.15 and lingering concerns over UK fundamentals and politics, markets remain cautious over whether the Pound can sustain further gains.

GBP/EUR Forecasts: Testing Resistance Above 1.15

The Pound to Euro (GBP/EUR) exchange rate has again tested resistance above the 1.1500 level and touched a 2-week high close to 1.1510 as the Pound again proved notably resilient in global markets.

Oil prices lost ground on hopes for a US-Iran deal while Sterling drew support on yield grounds as the 10-year bond yield retreated to around 4.76% from just above 4.80% yesterday.

Scotiabank commented; “Domestically, market participants are cheering strong demand for UK debt issuance, with sizeable orders for both Treasury offerings and those of large financial institutions.”

BoE policy expectations will be a significant factor. At this stage, markets are pricing in one rate hike this year with the potential for another move.

Committee member Greene, one of the most hawkish members within the MPC, stated that the inflation impact of higher energy prices was paramount, although she also noted that there are downside inflation risks while the labour market is weaker.

According to Greene, it could take months to determine whether there are second-round effects.

ING commented; “We remain of the view that the BoE won’t hike rates (market pricing 45bp by year-end), which should help a move to 0.88 in EUR/GBP.”

Nick Rees, head of macro research at Monex Europe commented; "In our view, this environment is actually quite constructive for the pound, not because anything's actually improved. We're just seeing traders distracted away from some really quite nasty fundamentals, political fundamentals in the UK."

The bank does expect that political issues will put the Pound under renewed pressure;. "We do have those local elections coming up at the beginning of May and we don't think markets or indeed a lot of politicians have grasped quite how bad these could be for the Labour Party."

MUFG maintains a negative stance on the Pound; “We already see scope for catch‑up GBP weakness to better reflect the negative energy price shock hitting the UK economy.”

The IMF expects that the UK economy will be the hardest hit by the Iran crisis. The 2026 UK GDP growth forecast has been cut to 0.8% from 1.3% previously. It does see a rebound in 2027 with 1.3% GDP growth.

The IMF is cautious over raising interest rates; "Reacting strongly to flexible commodity prices, when supply constraints are present only in the related sectors, brings down inflation fast but risks a recession later.”

The Euro-Zone 2026 GDP growth forecast has been lowered to 1.1% from 1.4% while the bank expects that the ECB will sanction two deposit-rate hikes to 2.5% this year.

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TAGS: Pound Euro Forecasts