Pound to Euro Exchange Rate News, Insight and Research. We continually update the site to keep those looking to make a major decision on the foreign exchange markets informed. For more see GBP to EUR.

February 2012: The key level for the pound to euro remains the 1.2 level. We continue to see the exchange rate gyrate around this level according to the underlying level of risk on the market. Risk desire is best expressed through demand for stocks and commodities. Hence a good day for markets usually sees the pound euro rate edge lower. Greece is grabbing the majority of attention at present. We don't see this relationship breaking down any time soon, neither do we see any significant break from the 1.2 level.

January 2012: The pound to euro has hit its highest level in well over a year as the exchange rate reaches, and holds, 1.2. The majority of analysts we follow believe the pound will continue to dominate the euro. The key largely lies with the euro which is understandably coming under pressures related to the ongoing Eurozone crisis. An ECB exchange rate cut in the 1st half of 2012 will certainly weigh further on the Euro as will the continued economic underperformance of the Euro area.

Meanwhile, the Pound is increasingly seen as a safe alternative to the euro. UK gilts are in demand as they are seen as safe, this has bid up the price of the pound. This situation is likely to remain for some time.

November 2011: The pound euro exchange rate is currently being driven by the prevailing attitude to risk on the markets. This changes on a daily basis, but, one as has been the case for much of 2011 the source of this attitude is the Eurozone debt crisis.

Indeed, the key variable in the pound to euro equation is the euro. So, with fears ebbing and flowing as to the nature of the euro's future, we see the exchange rate move.

The pound sterling is seen as a safe option on the exchange rate markets at present, or should we say UK Gilts are. UK Gilts are government bonds, and investors are confident that the UK government is a sound borrower. The same can't be said for many Eurozone countries! So, when things go downhill on global markets, people run for the safety of UK Gilts, which are priced in pounds, hence pound demand is driven up.

We expect this relationship to continue into 2012.