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The pound to euro exchange week has suffered a series of highs and lows amid the ongoing Brexit trade talks. However, after struggles towards the end of last week, sterling could be hit with new lows if a “no deal is found” according to one expert.
Post-Brexit trade talks resume for a “crunch week” today, ahead of the December 30 deadline, the outcome of which will play a crucial role for the GBP.
Michael Brown, currency expert at Caxton FX spoke exclusively with Express.co.uk to share his insight.
“Sterling struggled against the euro on Friday, falling to the low €1.11s, as significant month-end demand for the common currency put downward pressure on the pairing,” he said.
“Looking ahead, we are entering yet another ‘crunch week’ for the post-Brexit trade negotiations, the progress of which will continue to be the primary driving force behind the pound. The eventual outcome remains binary, sterling strength if a deal is agreed, sterling weakness if no deal is found.”
The pound is currently trading at a rate of 1.1143 against the euro according to Bloomberg at the time of writing.
Speaking on Friday George Vessey, UK currency strategist for Western Union Business Solutions said: “A high-level intervention between EU leaders and Prime Minister Boris Johnson is highly likely to trigger a breakthrough until then the negotiating teams will find they have little room for manoeuvre.
“A call between Johnson and EU Commission President Ursula von der Leyen is allegedly supposed to happen at some point, but a lack of confirmation keeps investors on their toes.
“France, Germany, Denmark, Spain, Belgium, Ireland and the Netherlands are likely to take part in the meeting.
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“These countries stand to gain or lose the most from an agreement on fisheries, now a major stumbling block to reach an overall trade deal with Britain.
“Britain and the EU can still clinch a Brexit trade deal and the shape of one is clear but London will not sign up to an accord at any cost, Prime Minister Boris Johnson’s finance minister said on Thursday.”
With an influx of travel expected over the festive period, many Britons may be looking to exchange their money into foreign currency.
However, amid the ongoing turbulence leading up to December 31 it may seem difficult to predict exactly when is best to change your money.
According to experts, staying up-to-date on relevant changes and planning in advance is one of the most crucial ways to ensure you secure the best rates.
Rob Stross, CMO of peer-to-peer currency exchange platform WeSwap said: “When it comes to travel money, with the peaks and troughs of the pound in light of Brexit, it’s difficult to plan when to buy your travel money.
“We’ve also done research that shows nearly half of Brits buy all their travel money in one sitting.
“It can be wise, however, to exchange half your holiday money now and half closer to when you go or if the pound strengthens.”
Holidaymakers can also secure the best rates by opting for a travel money card.
These cards can be used much like a debit card but without the risk of unexpected fees and charges.
They might also be beneficial during the coronavirus pandemic to help reduce the spread of the virus, suggest some experts.
After researchers at CSIRO, Australia’s national science agency found that the COVID-19 virus could live up to 28 days on bank notes, travel money cards were hailed as one way to lessen risk.
“If you are worried about banknotes, it’s certainly the case that a prepaid card is a very convenient and safe way for people travelling abroad to carry money,” a spokesperson from the Post Office told Express.co.uk.
However, they pointed out “following the same safety rules you would when handling other goods” will also help curb the spread.
The Post Office is one high-street travel money provider which offers its own international currency card.
At the time of writing, it is offering rates of €1.0773 for amounts of £400 or more, and a rate of €1.0985 for amounts of £1,000 or more.
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