The pound is trading at 1.1830 against the euro, according to the latest Bloomberg data at the time of writing. Sterling is struggling as the market considers what is in store for the UK in the March 11 Budget, which will be given by new Chancellor of the Exchequer Rishi Sunak.
Speaking exclusively to Express.co.uk, Michael Brown, Senior Currency Analyst at Caxton FX said: “Sterling came under pressure on Wednesday, falling to two-week lows against the common currency.
“This comes amid significant month-end flows as investors weighed the possibility of the Government maintaining the fiscal rules in the Budget – potentially limiting spending plans.”
Looking ahead to today, he continued: “Today, attention will remain on the political sphere, with the UK set to reveal its negotiating mandate for upcoming trade talks with Brussels, which get underway next week.”
With a fluctuating exchange rate and deadly coronavirus sweeping Europe and the world, what should holidaymakers do about their travel money?
The Post Office is currently offering a rate of 1.1577 on buys of £500 or more. They are offering a rate of 1.1636 on purchases of £1000 or more.
In recent days traders have kept their eyes on the rapidly developing coronavirus, which has spread from Wuhan, China to the rest of the globe.
It has majorly impacted the economy, changing the way people travel and spend. Industries across the world are now suffering as a result of the fast-spreading and highly contagious disease.
One of the worst affected regions is Asia, with Hong Kong’s hospitality sector reporting a major decline. Meanwhile, airlines and travel services have reduced or completely put an end to routes to and from China, cutting the region off from the rest of the world. British Airways and Virgin Atlantic both haunted flights to China, meanwhile limiting service to Hong Kong.
They were joined by KLM, Air France, Lufthansa, SAS, Iberia, Air Canada, Cathay Pacific and United also followed suit, slashing flights to China due to lack of demand.
With no sign of the virus slowing down, it is unlikely the pound will see any major boosts until the UK-EU trade talks begin again in March. Prime Minister Boris Johnson will be working to secure viable trade and immigration deals with EU countries.
Those that are viewed as successful could help supply the pound with some much-needed strength. Though, as seen during earlier Brexit negotiations, political occurrences can also have the opposite effect on the pound.
Ian Strafford-Taylor, CEO of FairFX commented: “Holidaymakers are already at the mercy of rollercoaster currency rates thanks to continued Brexit uncertainty, but now risk further rate turbulence as the already high airport margins are getting worse still.