Individuals send money from the UK to the other parts of Europe regularly, and this holds true for money entering the UK from other European countries as well. In 2016, more than U.S. $1.7 billion was sent as remittances from the UK to the France alone. In the same year, around U.S. $336 million made its way into the UK from Spain. This makes the EUR/GBP currency pair a fairly popular one in the forex market.
The EUR/GBP currency pair is among the most commonly traded minors. In January 2018, it was the 10th most liquid currency pair in the world, accounting for 43.35% of the global trade volume. The pound sterling is most commonly traded with the euro (GBP/EUR), followed by the U.S. dollar (GBP/USD). The GBP/EUR currency pair is commonly referred to as Chunnel in the forex market.
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The euro was launched as the official currency of the EU on 1 January, 1999. However, euro-denominated coins and banknotes were made available to the public on 1 January, 2002.
The euro has been adopted by 19 members of the European Union (EU) as their official currency. It also serves as legal tender in some overseas territories of EU members, Kosovo, and Montenegro. Cuba has used it as a trading currency since 1998, and Syria, since 2006. The countries in Europe where the euro is the official currency include:
In April 2016, the share of the euro in global foreign exchange market turnover was 31.4%, making it the second most commonly traded currency the world over.
|Nicknames||Quid, aereo, pavo, ege|
|Bank notes||EUR 5, EUR 10, EUR 20, EUR 50, |
EUR 100, EUR 200, EUR 500
|Coins||1c, 2c, 5c, 10c, 20c, 50c, EUR 1, EUR 2|
The Pound Sterling
The pound sterling, also called the British pound, has served as the official currency of the UK since 775 AD. Now, it is also the official currency in South Georgia and the South Sandwich Islands, the British Antarctic Territory, Tristan da Cunha, Jersey, Guernsey, and the Isle of Man.
The pound sterling is the world’s oldest currency still in use, and it is also the oldest actively traded currency. Owing to the fact that London is still an important forex hub, the pound sterling remains among the most popular currencies traded in the forex market.
In April 2016, the pound sterling’s share of the international forex market turnover stood at 12.8%, making it the fourth most traded currency globally. The pound sterling served as the world’s primary reserve currency for more than a century leading up to the World War I. It is now at the fourth spot.
|Nicknames||Quid, pound, bread, moolah, nicker, bones, |
dough, readies, folding stuff, paper
|Bank notes||GBP 1, GBP 5, GBP 10, GBP 50, GBP 100|
|Coins||1p, 2p, 5p, 10p, 20p, 50p, GBP 1, GBP 2|
Euro / Pound Sterling Historical Rates
Upon its introduction, the value of one euro stood at £0.69. While the UK was a part of the EU, it chose not to switch to the euro. From its introduction to 2007, the euro maintained relative stability against the pound sterling, averaging at around 0.6 to 0.7. Toward the latter half of 2008 the euro was embroiled in the European sovereign debt crisis. By the end of the year, the one euro valued at £0.9557.
The pound sterling has fallen against a number of currencies since the announcement of the brexit. After the EUR/GBP pair falling to 1:0.7089 in June 2015, the euro increased in value to £0.9211 by August 2017, before settling at around £0.87 to £0.88.
The EUR/GBP currency pair has a positive correlation with EUR/SGD and USD/CNH. It has a negative correlation with GBP/NOK and XAU/EUR.
EUR/GBP in the last five years
|1 July, 2013||GBP 0.8747|
|1 July, 2014||GBP 0.0730|
|1 July, 2015||GBP 0.7033|
|1 July, 2016||GBP 0.8448|
|1 July, 2017||GBP 0.8961|
EUR/GBP in the last five months
|1 March, 2018||GBP 0.8790|
|1 April, 2018||GBP 0.8870|
|1 May, 2018||GBP 0.8790|
|1 June, 2018||GBP 0.8847|
|1 July, 2018||GBP 0.8826|
What Affects EUR/GBP Rates?
The EUR/GBP pair is representative of Europe’s’ two largest economies – the Euro Zone and the United Kingdom. Given the economic codependence between these two regions, the EUR/GBP pair is not as volatile as other EUR or GBP based minors. However, changes in monetary policies made by the European Central Bank or the Bank of England can have an impact on the relationship between these two currencies.
Other factors that have a bearing on how the EUR/GBP pair behaves include inflation, popular market sentiment, economic growth, and trade balances.
When sending money from the UK to the Euro Zone or the other way around, bear in mind that the exchange rate you get affects the cost of your transfer. Fortunately, you can make the most of the market’s volatility by using different forex tools provided by some of the leading overseas money transfer companies. All you need to do to get started is compare your options and select a suitable service provider.