The pound to euro exchange rate made little developments over the weekend, kicking off the festive week with minimal movement. Sterling has crept up slightly since the end of last week, but with Christmas approaching, it is likely markets will remain rangebound.
The pound is currently trading at a rate of 1.1741 against the euro according to Bloomberg at the time of writing.
Moving into the Christmas week, political developments are unlikely, which means the pound should remain fairly stable in the coming days.
Speaking to Express.co.uk, Michael Brown, Senior Market Analyst, at Caxton FX said: “Sterling struck a softer tone on Friday, as market participants remained concerned about the tight timeframes to agreeing a UK-EU trade agreement by the end of next year, and the potential for a cliff-edge scenario in 12 months’ time.
“Today, with the festive season now upon us, markets will likely remain rangebound, barring any unexpected political developments.”
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Pound to euro exchange rate: How will the rates fare over the Christmas period?
Pound to euro exchange rate: The pound is currently trading at a rate of 1.174
All eyes will remain on political developments and Brexit decisions announced by Prime Minister Boris Johnson, moving forward.
It is likely that traders will be most reactive to a deal or no-deal scenario.
In recent months the pound has surged at the hope of a deal and seen dramatic drops when the threat of a “no-deal” has loomed.
It seems the most beneficial thing for the pound is political certainty, which was displayed shortly after the initial General Election 2019 results announcement.
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On December 13 the pound surged to an almost three-year high when the Tory landslide victory was declared, however, it has been declining ever since following plans unveiled by Mr Johnson’s government.
So, what does this all mean for travellers?
The Post Office is currently offering a rate of €1.1346 for over £400 and €1.1511 for over £1,000.
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Predicting the rates can be a difficult task, especially when the landscape is particularly volatile.
Though major changes aren’t expected in the next week, little is known what will happen in the new year.
Luckily, there are some ways travellers can make sure they are getting the most for their money.
Money Saving Expert Martin Lewis suggests opting for a credit card specifically overseas spending.
“If you normally spend abroad on debit or credit cards, while the providers get near-perfect rates, most add an up to three percent ‘non-sterling exchange rate fee’ on top – meaning something that costs £100 costs you £103,” Mr Lewis explained.
“Yet specialist overseas credit cards don’t add that fee, so you get the same near-perfect exchange rate as the providers – smashing bureau de change – in every country, every time you go away.
“Just ensure you pay the card off in full each month to minimise the interest.”
Meanwhile, travellers who prefer to use physical currency are advised to pay close attention to the costs associated with exchanging money.
Customers can get caught out when exchanging travel money, not only due to fluctuating exchange rates but also due to admin fees charged by certain bureau de changes.
Nicky Kelvin, Director for Content at the Points Guy UK advises: “When exchanging your money, remember that offers the worst exchange rates so either change your currency before you get to the airport, or use a card that offers zero percent foreign transaction fees for both purchases and ATM withdrawals.”