GBP/EUR exchange rate week review: pound weakens to eight-week low against euro
22/09/2025 to 26/09/2025: The pound slipped to an eight-week low against the euro as weak UK data and cautious Bank of England signals weighed on the UK currency.
Monday
The pound euro (GBP/EUR) exchange rate was mixed amid government approval for a second runway at Gatwick airport and stronger-than-expected Eurozone consumer sentiment.
Pound sentiment was bolstered by Chancellor Rachel Reeves, who pledged to deliver the government’s growth plans after approving the Gatwick expansion.
The single currency was buoyed after the consumer sentiment index advanced from –15.5 to –14.9 in September, exceeding forecasts but still well short of 0long-term norms.
Tuesday
The pound wavered versus the euro after the UK services PMI for September showed a sharper-than-expected slowdown in activity, before finding a modicum of support from an upbeat market mood. However, as market sentiment deteriorated, the UK currency softened, settling at around 1.144.
Geopolitical concerns initially dented the euro, after drone activity near Danish airports disrupted flights and ignited speculation over Russian involvement.
Mixed PMI data from the bloc failed to improve single currency sentiment. However, the euro pared some losses as diminishing risk appetite boosted the safer euro.
Wednesday
The pound slid slightly lower against the euro amid an absence of UK data and reports of a gloomy outlook for British businesses, including weak job creation.
The euro faltered after Germany’s business climate index missed forecasts, slumping to a four-month low. Heightened tensions between NATO and Russia added pressure to the single currency, after Moscow insisted it would continue its offensive in Ukraine following recent developments.
Thursday
The pound fell to an eight-week low around 1.143 against the euro after the Confederation of British Industry’s (CBI) distributive trades survey showed a persistent contraction in retail activity. The downbeat reading added to concerns about the UK economy.
The euro was undermined by its negative trading relationship with a strengthening dollar. Single currency losses were limited, however, by Germany’s consumer climate report for October, which revealed sentiment improving more than expected.
Friday
The pound strengthened into the 1.14 mid-range before arresting its gains after BoE policymaker Swati Dhingra said Britain's high inflation rate is likely to cool and the central bank should cut interest rates faster.
“The effects of the shocks driving the UK's current high inflation relative to Europe will fade, and thus, we should not be overly cautious about cutting interest rates.”
The pound euro exchange rate ended the week at around 1.144.
Looking ahead
The most influential economic indicator for the pound hits the headlines on Tuesday in the shape of GDP figures for the second quarter.
It’s a busier week for the euro with German retail sales and inflation data scheduled for release on Tuesday and Eurozone consumer price figures in the docket for Wednesday.