If you’re doing business in the UK or transferring money back home, your money will go further if you transfer with the right provider. Shaving 1% off your fees might not seem like much, but if you were sending £100,000, that would be £1,000 up for grabs.
Compare today’s rates from providers who can send EUR (euros) to GBP (pounds)
The table below allows you to select currencies and see how different currency transfer specialists stack up.
Table: sorted by a combination of service offering and the amount your recipient will receive
Disclaimer: Exchange rates change often. Confirm the total cost with the provider before transferring money.
How does the euro trade against the British pound historically?
On January 1, 1999, the euro was introduced in 11 states of the European Union (EU) as a “single currency” — used by all members of an economic federation. At the time of its debut, the euro was at a rate of 1.42 euros to 1 pound. Despite being an EU member state, the UK chose not replace its country’s currency with the euro.
In the first three years after its introduction, the euro was used only for bank transfers, online transactions and travellers’ cheques. But this all changed in January 2002, when euro notes and coins were introduced in the now 12 participating countries, with Greece also willing to use the euro as its official currency.
From 1999 to 2007, the euro held a stable value average of 0.6 against the pound. However, in late 2008 the euro became caught up in the European sovereign debt crisis, which led to an increase of 0.70 pounds to one euro by the end of that year.
What is the European sovereign debt crisis?
The European debt crisis began when the peripheral eurozone member states of Greece, Spain, Ireland, Portugal and Cyprus found themselves unable to repay their government debt due to slowing economies and rising interest rates, among other economic issues. Its effects are still being felt.
In an attempt to stabilise the euro, the European Financial Stability Facility was created to address the crisis. Rates improved as a result, reaching 0.93 GBP to 1 EUR by October 13, 2009.
The effects of Brexit on currency exchange
Since Brexit — or Britain’s proposed exit from the European Union — in June 2016, the GBP has declined against several currencies. For the euro, Brexit could potentially mean that it gains against the pound. We saw the euro jump from 0.79008 against the pound in June 2016, shortly after the Brexit referendum, to 0.841735 in July 2016. Since July 2016, the euro has remained stable at between around 0.8 and 0.88 to the pound.
EUR > GBP exchange rate history
We’ve put together the annual average exchange rate for the euro against the British pound from 2010 to 2020.
Euro to British pounds over the last 10 years
1 EUR =
1 GBP =
What affects EUR > GBP exchange rates?
In general, five factors affect how the euro trades against the British pound.
Prices and inflation
Inflation affects all currencies, including the euro. Countries with high levels of inflation relative to other countries will typically see its currency depreciate so that the prices of goods between countries remain equal. In the eurozone — or the group of nations that trade in the euro — inflation is measured by the Consumer Price Index (CPI), which calculates the price of a selection of goods that an average household is likely to purchase.
Confidence and sentiment
By looking at confidence and sentiment reports, you can also gauge economic conditions in countries that trade in the euro. A popular sentiment report to follow is the German ZEW Survey, prepared each month by the Center for European Economic Research.
All currency is affected by monetary policies, which are constructed by currencies respective to a country’s central bank. For the euro, that’s the European Central Bank. Monetary policies include interest rates that significantly affect the euro.
The growth and health of the eurozone significantly influences the euro, measured by the gross domestic product. For the eurozone, the GDP is a periodic measure of the value of the total goods and services produced in the area. For all currencies, including the euro, growth in GDP is a sign that the economy is strong and healthy.
Balance of payments
The balance of payments is like a country’s accounting record of interaction with the rest of the world. It’s made up of three accounts, but only the current account affects exchange rates. This account reveals how much a country is exporting and importing, as well as the flow of income and transfer payments.
Did you know?
The EUR/GBP currency pair is often referred to by forex traders as trading the “chunnel”.
When transferring money internationally, do your research to ensure that your money goes further in an exchange. With Brexit and other current events, the British economy is shaky — which could mean a better deal when converting your euros to pounds.
Frequently asked questions
The UK and the European Union are now in a transition period, which is expected to last until 31 December 2020.
Hundreds of economic indicators can affect the euro, but the five we’ve highlighted — prices and inflation, confidence and sentiment, monetary policy, economic growth and balance of payments — are the most influential.
No, the euro is the world’s second most traded currency after the US dollar.
Charlie Barton is a publisher at Finder. He specialises in banking and investments products, including banking apps, current accounts, share-dealing platforms and stocks and shares ISAs. Charlie has a first-class degree from the London School of Economics, and in his spare time enjoys long walks on the beach.
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