Euro to pound forecast: Third-party EUR/GBP price target

The British pound has been moving sideways against the euro, yet can it regain momentum? Read on for a GBP/EUR forecast.

By Dan Mitchell15:38 (UTC), 9 July 2025 Updated

Euro to pound forecast: Third-party EUR/GBP price target — Photo: Ascannio/Shutterstock.com

The euro to pound exchange rate traded in a tight range of 0.83-0.87 through the first half of 2025, averaging around 0.84-0.85 as of mid-June, according to exchange-rates.org.

The Bank of England’s slower pace of rate cuts – compared to the ECB – played into a muted currency response, with both economies posting mixed growth and inflation data.

As key central bank decisions and economic releases approach, where might EUR/GBP head next? Below, we explore third-party price targets, analyst projections, and the factors shaping the EUR/GBP forecasts for 2025 and beyond.

Euro to pound forecast for 2025 and beyond

As of early July 2025, major banks and algorithm-based services have offered varied euro to pound forecasts for 2025 and beyond.

ING Bank analysts projected the EUR/GBP rate at around 0.86 by the end of Q2 2025, where it remains for Q3 and Q4, then rising to 0.87 in early 2026, and 0.88 by late 2026. Danske Bank expected the rate to reach 0.85 in one month’s time, increasing to 0.87 within the next year.

However, Allied Irish Bank (AIB) had a more positive view of the pound, forecasting EUR/GBP to trend lower, from a range of 0.81-0.87 in mid-2025 to as low as 0.80-0.86 by Q1 2026. The bank attributed the euro’s potential short-term weakness to risks posed by ongoing US tariffs and delayed impact from recently announced European stimulus measures, contrasting with stronger UK economic fundamentals and recently secured trade agreements with the US, eurozone and India.

The UK’s Office for Budget Responsibility (OBR), meanwhile, expected a modest 1.19% rise in EUR/GBP through 2025, slightly higher than its October 2024 projection. The OBR noted the pound was about 0.75% stronger against the euro than it had previously anticipated.

Trading Economics also weighed in, projecting the euro to fall against the pound, reaching around 0.85442 by the end of the quarter and 0.85416 in one year’s time, as of 1 July 2025.

EUR/GBP algorithmic forecast: Long-term views

	Low	Avg	High
CoinCodex	1.10	1.12	1.13
Gov Capital	0.72	0.79	0.88

Algorithmic forecasts have also varied significantly. Wallet Investor anticipated EUR/GBP closing 2025 around 0.87, with a gradual decline towards 0.85 by late 2029. Coin Codex projected an average EUR/GBP of approximately 0.89 for 2025 between 0.86 and 0.92 – while expecting steady growth in subsequent years, with rates potentially exceeding 1.2 by 2029-2030.

Gov Capital highlighted potential volatility ahead, forecasting an average euro to pound rate of 0.82 within the next 12 months, fluctuating between lows of 0.74 and highs around 0.9. By 2030, its algorithm forecasted an average rate of 0.79, potentially peaking at approximately 0.88.

While predictions vary, it's important to remain mindful of the unpredictability inherent in forex markets. Economic developments, policy decisions, and global events can swiftly influence the EUR/GBP exchange rate, reinforcing the necessity of ongoing research and cautious trading strategies.

Euro to pound prediction: Analysts’ outlook

On 10 June 2025, ING analyst Chris Turner flagged weaker UK labour data from April as a drag on sterling, noting it ‘triggered a 20 pip rally in EUR/GBP to 0.8435’. He warned that narrowing interest rate differentials between the Bank of England (BoE) and the European Central Bank (ECB) could weigh on the pound over the next 12-18 months, identifying 0.8445-0.8460 as key short-term resistance levels.

Earlier, in May, Goldman Sachs noted that while the pound had outperformed the euro earlier in 2025 – thanks to the BoE’s hawkish stance – momentum had since shifted toward the euro. The bank observed that the euro had become the ‘primary gainer versus the dollar’, though sterling held some ground due to its lower exposure to global trade tensions compared to the eurozone.

Meanwhile, AIB struck a cautiously optimistic tone, pointing to stronger UK growth and fresh trade deals with the US, Eurozone, and India. While acknowledging the boost European assets received from fiscal stimulus, AIB noted that the positive impact on growth may take longer to emerge and warned that US tariffs remained a short-term risk.

Technical analysis from TradingView, based on 25 one-month signals (11 oscillators and 14 moving averages), leaned bearish. Eleven signalled ‘sell’, nine were neutral, and five suggested a ‘buy’.

While expert views and technical signals vary, the EUR/GBP outlook remains highly sensitive to economic data, policy shifts, and global events. As ever, careful analysis and disciplined risk management are essential.

Past performance is not a reliable indicator of future results.

Pound to Euro rate history

In early 2022, EUR/GBP began trading around 0.83 but steadily climbed as economic headwinds intensified. By September, UK political instability following the Liz Truss government’s mini-budget saw EUR/GBP spike, reaching a high of 0.9000 on 26 September – the pair’s strongest rate for the year (reflecting a weaker pound against the euro). Despite this volatility, the average exchange rate in 2022 stood at approximately 0.8530, reflecting a year of pronounced fluctuations.

Throughout 2023, EUR/GBP struggled to regain downward momentum (signalling a firmer pound at times). Pressured by mixed economic signals on both sides of the Channel, the pair reached a high of 0.8966 in February but subsequently eased, touching a yearly low of 0.8518 in July. The annual average settled at around 0.8700, highlighting continued uncertainty amid persistent inflation and central bank actions.

2024 brought gradual improvement for sterling, with EUR/GBP trading predominantly between 0.83 and 0.86 – notably touching a low of 0.8233 (the strongest level for the pound since early 2022) on 11 December. The year ended on a positive note for the pound, with the annual average EUR/GBP rate at 0.8470.

By June 2025, the pair was averaging around 0.8410, slightly firmer than in recent years.

Past performance is not a reliable indicator of future results.

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What drives the euro to pound pair?

The EUR/GBP rate is influenced primarily by central bank policies, economic data, political stability, and external market trends. Understanding these factors can help traders anticipate potential movements in the pair.

Interest rate differentials

Monetary policy decisions by the Bank of England (BoE) and the European Central Bank (ECB) can significantly affect EUR/GBP movements. If the ECB signals a more hawkish stance or tightens policy relative to the BoE, capital flows may favour euro-denominated assets, potentially strengthening the euro against the pound.

Conversely, if UK rates are higher, sterling may find support as investors seek greater returns. Traders closely monitor GDP growth, CPI inflation, employment data, purchasing managers’ indices (PMIs), and wage growth, as these indicators influence central bank actions and market expectations.

Economic fundamentals

Economic indicators such as GDP growth rates, inflation figures (CPI), and trade balances directly affect EUR/GBP. Stronger-than-expected eurozone data can enhance the appeal of the euro, while resilient UK data may support the pound.

For instance, if eurozone growth or inflation outpaces expectations, markets may anticipate tighter ECB policy, underpinning the euro and pushing EUR/GBP higher. Similarly, positive surprises in UK data could lend support to sterling, resulting in a lower EUR/GBP rate.

Geopolitical conditions

Government policies and political stability indirectly influence EUR/GBP. Pro-business policies, trade agreements, and stable governance typically increase currency confidence. Political uncertainty or abrupt policy shifts, however, can trigger volatility. The UK has signed trade agreements with several major economies in recent years, though a comprehensive deal with the US has not yet been concluded.

Ongoing discussions and agreements with the eurozone and India have contributed to market sentiment, but traders remain vigilant to political developments.

External market trends

Stock market performance and global risk sentiment also influence EUR/GBP exchange rates. In periods of market optimism, investors may favour higher-yielding or riskier assets, which could benefit the pound if UK assets are attractive.

In contrast, during bouts of risk aversion, flows may move into perceived safe havens such as the US dollar or Swiss franc, though the euro can also benefit given the size and relative stability of the eurozone. Commodity market swings may have an indirect effect on the pair, particularly where they impact risk sentiment or sectors tied to the UK or eurozone economies.

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Final thoughts

When looking at any euro to pound forecast, it’s essential to remember that forex markets are unpredictable by nature. Analysts and algorithmic projections provide valuable reference points but should never replace your own comprehensive analysis.

Combine forecasts with independent research; and stay up to date on UK and eurozone economic news, monetary policy updates, and market analysis to form a balanced view. Technical and fundamental analyses can support informed trading decisions, but neither guarantees success.

FAQs

Why has EUR/GBP been moving sideways?

EUR/GBP has recently traded within a stable range, influenced by balanced economic data and relatively cautious monetary policies from both the Bank of England (BoE) and the European Central Bank (ECB). Neither economy has clearly outperformed the other, with mixed inflation and growth signals keeping traders cautious. Ongoing uncertainties, such as US tariffs affecting European exports and Britain's steady but moderate economic improvements, have limited decisive moves in either direction.

Could EUR/GBP go up or down?

EUR/GBP could rise or fall depending on interest rate expectations, central bank actions, economic data releases, and trade developments. A more aggressive ECB rate-cutting cycle or improved UK economic data could see EUR/GBP move lower (strengthening the pound), while a slower BoE rate-cutting path or signs of a stronger eurozone recovery could push the rate higher (strengthening the euro). Traders should closely monitor central bank communications, inflation reports, employment figures, and geopolitical developments to gauge potential moves.

When is the best time to trade EUR/GBP?

The best times to trade EUR/GBP have historically been during periods of highest market liquidity and volatility, particularly during the London and European forex market hours. These periods coincide with significant economic announcements such as UK CPI, GDP, employment data, and ECB policy decisions, leading to higher liquidity and heightened market activity, although spreads may not always be tighter. Trading outside these times may offer lower liquidity and wider spreads.

Is EUR/GBP a buy, sell or hold?

EUR/GBP's current outlook is mixed, reflecting caution among analysts and technical indicators. Recent analyst opinions show both potential upside and downside risks, depending on economic data, central bank actions, and geopolitical events. Short-term technical indicators remain mixed, with some neutral and some bearish signals. Traders should consider their risk tolerance, trading horizon, and ongoing developments in monetary policy and economic performance before deciding whether to buy, sell, or hold positions in EUR/GBP.