Pound-to-Euro Exchange Rate Set to Fall to 1.15 by Q2 2027: Survey

The latest Exchange Rates UK Research survey of major investment banks suggests that the Pound-to-Euro exchange rate will struggle to extend its gains in 2026. The median forecast points to a decline of approximately 1.1% from current levels, with GBP/EUR settling around 1.15 by Q2 2027.

The survey's central message is not for a dramatic sterling decline. Rather, the banks expect consolidation rather than a major reversal. However, there is substantial disagreement between individual institutions, with forecasts ranging from approximately 1.12 to 1.19.

Pound Sterling has entered the final quarter of 2026 from a relatively strong position against the euro, having gained approximately 1.4% in 2026 so far. However, momentum has faded since July, and recent sessions have produced modest declines.