Picture by Lauren Hurley / No 10 Downing Street
Pound Sterling Live's latest investment bank poll on the GBP/EUR exchange rate reveals a clear shift in sentiment compared to the March survey.
Back in March, the median forecast suggested a steady rise in GBP/EUR, with expectations anchored above 1.20 through the 3–9 month horizon.
Since then, however, updated projections from over 30 leading financial institutions point to a notable downgrade in expectations for the Pound.
To view these latest point forecasts, which show the mean, median, highest and lowest figures aggregated from over 30 investment banks, please request a copy.
We consider the median and mean forecast points to be the most accurate and credible forecasts available as they harness the wisdom of crowds; they allow those with payments to make credible and rational judgements when considering sending money.
For individuals or businesses planning to send money from Pounds into Euros, the new forecasts imply that waiting could result in less favourable rates if the Pound weakens further.
Conversely, those converting Euros into Pounds may benefit from improved exchange rates if the revised forecasts prove accurate.
Whether you're making a large international payment, hedging business exposure, or timing a personal transfer, understanding the evolving market view is critical, and the latest forecast data offers valuable guidance.
The June data suggests that forecasters have reassessed the Pound's prospects, with the overall profile flattening or tilting lower.
The shift reflects the notable turn in sentiment towards Pound Sterling over the past three months, centred on a series of data disappointments and renewed fears about UK government finances.
Chancellor Rachel Reeves faces a £50BN black hole in the government finances and economists are warning that she will be forced to break Labour's manifesto pledge on tax in the autumn budget.
Although sentiment has soured, some analysts are happy to adopt a contrarian approach and anticipate a GBP/EUR recovery.
"We retain a constructive view on GBP into year-end," says Shamal Karma, analyst at Bank of America. "We concede that view is increasingly out of consensus, but we stick with our lower EUR/GBP conviction as we think the UK has emerged from the tariff tumult in a better position than the Eurozone, that BoE pricing is a more accurate read vs ECB pricing."
In particular, Bank of America looks for further interest rate cuts from the European Central Bank (ECB), while the market is of the opinion the ECB is more or less complete. Further cuts could present fresh headwinds for the Euro.
See Bank of America's forecasts and how they compare to peers in the Q3 Consensus Forecast Document.