GBP/EUR Exchange Rate Forecast: Euro Awaits German Inflation Data

Pound-to-Euro Rate Holds Steady After Overnight Volatility

The GBP/EUR exchange rate remained stable on Friday following an overnight spike, with traders awaiting key German economic data that could influence the Euro’s (EUR) performance.

Today’s Key Drivers for GBP/EUR

• German Retail Sales (April) – Expected to show recovery, potentially boosting the Euro.

• German Inflation (May Preliminary) – Forecast to dip to 2% (from 2.1%), possibly increasing ECB rate cut bets and weakening the EUR.

• US Dollar (USD) Impact – A retracement in USD strength could support the Euro.

• Risk Sentiment & Pound (GBP) Movement – With no major UK data, Sterling may fluctuate based on global risk appetite.

Daily Recap: GBP/EUR Stabilizes After USD-Driven Swing

The Pound to Euro exchange rate traded flat on Thursday, hovering around €1.1943 after an overnight surge linked to US Dollar volatility.

• EUR Weakness Overnight – The Euro dipped as the USD rallied following a US court ruling against Trump-era tariffs, raising hopes for reduced trade tensions.

• GBP Lacked Momentum – With no UK economic releases, Sterling saw limited movement but benefited slightly from improved risk sentiment.

Outlook: Will German Inflation Weigh on the Euro?

If today’s German inflation data confirms a slowdown, markets may price in a sooner ECB rate cut, pressuring the EUR/GBP exchange rate. Meanwhile, the Pound’s direction will depend on broader market risk trends.

Stay tuned for further forex updates as the GBP/EUR rate reacts to today’s economic releases.