Author, Andrew Gibson
Below you will find out the highs, lows & averages of the Pound to Euro rate, its full history, why you can’t trust forecasts, and how to achieve a better rate.
Highest pound to euro rate ever
The highest Pound to Euro rate ever was €1.752 on 3rd May 2000.
Following the Euro’s launch in 1999, it performed poorly relative to the Pound as investors had concerns about whether it would be a short-lived experiment.
Lowest pound to euro rate ever
The lowest Pound to Euro rate ever was €1.02 on 30th December 2008.
This was during the global financial crisis at which point the UK banking system was fragile and required government support to stave off collapse.
What is the average pound to euro rate?
The Pound to Euro rate has averaged €1.33 over its full 20-year history.
Therefore at current levels, the Pound sits well below the average rate since inception.
Over the past decade, the Pound has traded at much lower levels than the decade before.
In the past 10 years, the average GBP/EUR rate has been €1.20.
Brexit effect on Pound to Euro
Following the Brexit referendum result, the Pound dropped sharply in value against the Euro.
The Pound fell 16% against the Euro in the 4 months following the Brexit referendum, including 6% on the actual day of the result.
The rate has yet to rebound to pre-Brexit levels.
For the last few years, the Pound to Euro rate has spent most of the time in a range between €1.10 – €1.20.
Will the Pound ever recover?
The Pound to Euro rate was €1.30 prior to the Brexit referendum. It hasn’t been back to those levels since.
The recovery of the Pound will depend on whether the UK is better or worse off following Brexit.
So far there has been some disruption to trade and labour shortages in certain industries. It’s too early to know whether these are temporary factors or will trigger higher UK inflation.
The IMF is forecasting the UK to have better economic growth than the EU in 2022. This is expected to have a positive impact on the GBP to EUR rate.
Why Pound to Euro rates you see are often ‘fake’
You can easily get a Pound to Euro rate off the internet these days.
Websites like XE, FX Street, Oanda and Daily FX, offer live Pound to Euro rates to 5 decimal places.
Even Google automatically gives you a rate now.
But here’s the problem…
Most of the Pound to Euro rates shown online are not customer rates.
What you are actually seeing is something called an ‘interbank rate’.
As the name implies, an interbank rate is a rate used by one bank to trade with another bank.
It is like a wholesale rate.
Even large corporations, who buy and sell currencies in the billions, don’t trade at interbank rates.
If you just want a rough idea of the GBP to Euro rate, then by all means, use interbank rates as a yardstick.
However, if you actually want to convert Pounds into Euros (real money), interbank rates can be very misleading.
Here’s the sneaky bit…
A lot of the websites that show ‘fake rates’ are using them as a hook to lure in customers.
They dangle a teaser rate, then provide a link to a money transfer company.
But when you go to convert your money, you get a different rate.
What can you do about it? My advice is simple.
If you need to convert Pounds to Euros, then get a genuine quote directly from a bank or a money transfer specialist.
Using a real exchange rate will allow you to budget more effectively and avoid any unexpected shocks later on.
To get our latest GBP to Euro rate, please request a quote below.
Pound to Euro graph (with the ups and downs explained)
Pound to Euro – its 20-year history in a nutshell
- The GBP/EUR rate started out in 1999 at just above the €1.40 level.
- For its first few years, there were doubts over the Euro’s credibility. The Pound gained in value relative to the Euro.
- Within a year of the Euros launch, the value of the Pound shot up to €1.752 – which remains the all-time high.
- By 2003, the Pound was back down to the launch rate of €1.40 as the Euro became firmly established as a currency.
- From 2003-2007, the GBP to EUR rate hovered between €1.40 – €1.50. A rare period of stability.
- During the global financial crisis of 2007/8, the Pound nosedived as the UK government provided £500 billion in support to prevent a collapse of the British banking system.
- In late December 2008, the Pound hit an all-time low of €1.02.
- From 2013-2015, the Euro fell heavily as debt problems emerged with the ‘PIGS’ (Portugal, Greece, Spain & Italy). The future viability of the EU was questioned.
- In February 2016, the Brexit referendum was announced. The Pound began another steep descent.
- On the day of the ‘shock’ result in June 2016, the Pound suffered its biggest ever one-day fall against the Euro of 6.02%.
- Since the Brexit vote, the Pound had been clawing its way back up against the Euro (until Coronavirus triggered another sell-off).
On the move? … Here’s a 3 minute video summary
Can you trust Pound to Euro forecasts? (Hint: No)
I’m just going to come out and say it: I don’t trust exchange rate forecasts.
For the sake of full disclosure: I don’t believe in the tooth fairy or the easter bunny either.
Nor do I believe in Father Christmas (although I still want to).
Don’t get me wrong; I understand why forecasts exist.
People naturally want to know what the future holds…me included.
But that doesn’t mean someone or something can somehow come up with a reliable answer.
When I have searched for Pound to Euro forecasts on the internet, I have found a bunch of rubbish.
The methodology used (if there is one) is highly questionable.
Most of the time it is a simple extrapolation of the current rate with a tweak here and there.
I’ve worked in finance for over 20 years.
I know that whatever I say won’t change the fact that people crave certainty and will go looking for it.
But as my old boss would say “to the left is history, to the right is mystery”.
I have yet to find anyone with a crystal ball, magic wand, or secret potion that can predict exchange rates in the future.
There are just too many moving parts in currency markets to make a computer model remotely accurate.
If someone could predict the future, the last thing on Earth they would do is post the information on the internet.
They would be making billions trading foreign exchange themselves.
It’s basically like believing someone can predict next week’s winning lottery numbers.
Forecasts are fantasy.
Don’t shoot the messenger please. I come in peace.
Getting the best Pound to Euro exchange rate
While I am sceptical about predicting the future, I’m not suggesting you should ignore exchange rate fluctuations.
The exchange rate you achieve is important.
Even small movements in GBP to Euro exchange rate can make a large financial difference.
In fact, a lot of people underestimate how sensitive currency exchange is to the rate.
Here’s a quick example… Say you’ve bought a property in Spain for €80,000. The GBP/EUR rate is £1 to €1.15. So the price works out at £69,565. However, in the weeks waiting for the transaction to complete, some bad economic news comes out. The GBP/EUR rate drops down to €1.13. This means your property will now cost you £70,796. That small exchange rate fluctuation added an extra £1,200 to the price. Moves in the Pound to Euro rate of 1-2% happen all the time – sometimes within a day. Over several weeks you can see accumulated moves of 3%, 4% or even 5%. Now you’re talking substantial money. It’s why timing is critical. Most people have neither the time or inclination to watch the Pound to Euro rate all day. And foreign exchange markets may be something you aren’t familiar with. It’s why a money transfer service may be a good option for you. As a money transfer specialist, we watch rates continuously throughout the day. It’s a key part of what we do. We help our clients achieve a better rate by taking advantage of any favourable moves. Getting some guidance on exchange rates can help take away ‘rate anxiety’. It doesn’t matter whether you have a few days, weeks or even months to exchange your money. During this time, there will be ups, downs and everything in between. The key is to take advantage of those market markets. That’s a fundamental difference in the service we offer. We will understand your situation and help exchange your Pounds into Euros to your best advantage. A bank or online platform won’t look out for you. They just give you access to a platform and leave you to do everything yourself. Key Currency is an independent money transfer specialist. We offer highly competitive GBP to Euro exchange rates, don’t charge you any fees, and provide you with personal service. As a company, we are open and transparent. We don’t hide behind a logo or ‘app’. The names, faces, and backgrounds of our team of people are shown on our website. We have gained a 5-star rating on the customer review website Trustpilot, based on over 900 reviews. We’re committed to providing a service of the highest integrity and safety. Key Currency is an FCA regulated Authorised Payment Institution (No. 753989), and as such, all money transfers are conducted through safeguarded client accounts. To compare our pound to euro rates, just request a free quote. You are under no obligation to trade with us.
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