Pound-to-Euro Holds near 1.18 despite German Orders Collapse

Modified: Tuesday, 6 October 2026 19:46 BST - Written by Tim Boyer

STORY LINK Pound-to-Euro Holds near 1.18 despite German Orders Collapse

The Pound Euro (GBP/EUR) exchange rate moved broadly sideways on Tuesday as the Euro’s (EUR) recent losses began to ease.

At the time of writing, GBP/EUR was trading at €1.1776, virtually unchanged on the day.

The Pound (GBP) traded without a clear direction on Tuesday, with a quiet UK economic calendar leaving Sterling without a strong catalyst.

The Pound continued to find some support from growing expectations of a more hawkish Bank of England (BoE) stance, as well as hopes of closer ties between the UK and EU.

However, while these factors helped to keep GBP exchange rates buoyant, they were not enough to push Sterling higher.

The Euro stabilised on Tuesday after falling to multi-month lows against several peers on Monday, as concerns over a potential French debt crisis and political uncertainty in Spain rattled the single currency.

The Euro found some support as French bond markets steadied, while a weaker US Dollar (USD) also offered relief.

The single currency’s strong negative correlation with the ‘Greenback’ meant that the latter’s decline helped to limit further losses for EUR.

The Euro also proved resilient in the face of a sharp deterioration in German factory orders.

Fresh figures revealed that orders fell by 10.6% in August, far exceeding expectations for a 1% decline.

Near-Term GBP/EUR Forecast: German Data Takes Centre Stage

Looking ahead to Wednesday, Germany’s latest industrial production figures are due in the morning.

A modest improvement in output could offer some support to the Euro, although gains may remain limited.

A weaker-than-expected reading, meanwhile, could put fresh pressure on the single currency.

Speeches from two European Central Bank (ECB) policymakers may also shape EUR exchange rates.

Piero Cipollone is viewed as dovish, while Boris Vujčić is considered hawkish, potentially leaving the Euro vulnerable to some volatility if their comments strike contrasting tones.

For the Pound, the UK’s economic calendar remains light on Wednesday.

With few domestic catalysts to drive Sterling, GBP may struggle to establish a clear direction.

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TAGS: Pound Euro Forecasts