Pound-Euro Slips as UK Services Growth Disappoints

Modified: Wednesday, 23 September 2026 20:01 BST - Written by James Fuller

STORY LINK Pound-Euro Slips as UK Services Growth Disappoints

The Pound Euro (GBP/EUR) exchange rate edged slightly lower on Wednesday as markets assessed the latest PMI figures from both the Eurozone and the UK.

At the time of writing, GBP/EUR was trading at €1.1638, with the pairing marginally lower on the day.

The Euro (EUR) found its gains limited on Wednesday, despite encouraging Eurozone PMI figures.

The latest manufacturing index came in just above expectations, indicating that factory activity remained at a solid 52.7 in September.

Services activity offered a more notable upside surprise, with the PMI climbing from 51.6 to 53, comfortably ahead of forecasts for a decline to 51.5.

Despite the stronger-than-expected figures, the Euro failed to gain much ground.

The single currency remained under pressure from its strong negative correlation with the strengthening US Dollar (USD).

The Pound (GBP) came under some pressure on Wednesday after the latest UK PMI figures painted a mixed picture for the economy.

Although the manufacturing PMI unexpectedly showed an increase in activity, the more closely watched services PMI pointed to a sharper-than-anticipated slowdown.

Sterling found some support from an upgrade to the UK’s 2026 growth forecast by the Organisation for Economic Co-operation and Development (OECD).

The organisation expects government support measures to provide a boost to domestic growth.

The improved outlook helped to limit the Pound’s losses.

Near-Term GBP/EUR Forecast: Central Bank Remarks in Focus

Thursday’s calendar brings Germany’s latest IFO business climate index into focus.

A slight improvement in September could provide some support for the Euro, although the data is unlikely to trigger a significant move higher.

The single currency will also take cues from speeches by European Central Bank (ECB) officials Isabel Schnabel and Chief Economist Philip Lane.

Diverging signals on the outlook for monetary policy could leave EUR trading unevenly.

For the Pound, attention will turn to the Confederation of British Industry (CBI) distributive trades survey.

If September’s reading delivers another downbeat result, Sterling could struggle to find momentum.

Two speeches from Bank of England (BoE) policymakers will also offer potential direction for GBP.

Markets may pay less attention to comments from known dove Swati Dhingra, instead focusing on Deputy Governor Sarah Breeden. A continued cautious tone from Breeden could put further pressure on the Pound.

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TAGS: Pound Euro Forecasts