Sterling is forecast to trade roughly 1.15–1.17 against the euro and 1.31–1.34 against the US dollar in the week beginning 29 June 2026, with the final reading of UK first-quarter GDP, eurozone inflation and US payrolls the dominant drivers. EUR/USD is expected to hold near 1.14 as a firm dollar continues to cap the euro.
This is the rare week when the Bank of England, the Federal Reserve and the European Central Bank are all leaning the same way — hawkish — after an energy-led inflation shock. For anyone moving money for a property purchase, a business payment or family reasons, that backdrop matters more than any single day’s rate.
Why are the pound, euro and dollar all under pressure to behave differently?
Three central bank meetings in June reset the picture, and all three moved in a tightening direction:
- The Bank of England held Bank Rate at 3.75% on 18 June 2026, voting 7–2, with two members pushing for an immediate rise to 4% (Bank of England).
- The Federal Reserve held its target rate at 3.50%–3.75% on 17 June 2026 — Kevin Warsh’s first meeting as Chair — and signalled a possible hike later this year, with nine of 18 policymakers now projecting tightening in 2026.
- The European Central Bank raised its deposit rate to 2.25% on 11 June 2026, its first rate increase since 2023, lifting the main refinancing rate to 2.40% and the marginal lending rate to 2.65% (ECB).
The common cause is the inflation spike that followed this year’s Middle East conflict, which pushed energy prices sharply higher before they eased back. UK inflation was 2.8% in May, eurozone inflation reached 3.2% — its highest since September 2023 — and US inflation hit 4.2%, the highest since April 2023. Markets that began 2026 pricing rate cuts are now pricing holds and, in places, hikes. That repricing is the single biggest force acting on exchange rates this week.
GBP/EUR forecast: can the pound break 1.16?
GBP/EUR is trading around 1.16, just below the 1.1600 resistance level that has capped it for most of 2026. The pair has spent the year in a tight 1.14–1.16 band, held up by the gap between UK and eurozone interest rates.
That gap is now 1.50 percentage points (Bank Rate 3.75% versus the ECB deposit rate of 2.25%) — still in the pound’s favour, but narrowing as the ECB tightens while the Bank of England holds. The forward market reflects this, implying a slight drift lower over the coming months rather than a decisive break higher.
Two events will set the tone this week: the final reading of UK first-quarter GDP on Tuesday and eurozone flash inflation for June on Wednesday. A soft UK growth number or a hot eurozone print could each cap sterling near 1.16.
There is also a domestic overlay. Prime Minister Sir Keir Starmer announced on 22 June 2026 that he intends to resign as Labour leader, with the party’s leadership contest opening on 9 July. Political transitions rarely move sterling on their own, but they add a layer of uncertainty that can amplify reactions to the data. GBP/EUR may trade in a 1.15–1.17 range this week, with the 1.16 ceiling the level to watch.
“The pound is sitting near the top of its euro range, which is a genuinely useful starting point if you have euros to buy. But 1.16 has held all year, and the forward curve drifts lower. For most clients the question isn’t whether the pound will break out — it’s whether the rate in front of them is good enough to act on.”
Anthony Bull, CEO, Cambridge Currencies
GBP/USD forecast: a strong dollar keeps sterling capped
GBP/USD is trading near 1.32, down from a mid-June high close to 1.34. The US Dollar Index broke above 100 in June after the Fed’s hawkish hold, and higher-for-longer US rate expectations have rewarded the dollar across the board.
The week’s biggest risk event is US non-farm payrolls on Thursday 2 July — released a day early because US markets close on Friday for Independence Day. A strong jobs number would reinforce the case for a Fed hike and could pressure GBP/USD toward the lower end of its range; a soft number could give sterling room to recover. GBP/USD is forecast to trade around 1.31–1.34 this week, with payrolls and Tuesday’s US ISM manufacturing survey the key triggers.
EUR/USD forecast: range-bound near one-year lows
EUR/USD is trading around 1.14, its lowest since June 2025. The euro is not weak so much as out-muscled: even after the ECB’s first hike in three years, the dollar’s strength has pulled the pair toward the soft end of its 2026 range.
The Fed–ECB rate gap stands at 1.50 percentage points. The longer-term case for a higher EUR/USD rests on that gap narrowing if the Fed eventually cuts while the ECB holds — but near-term, the dollar is in the driving seat. Wednesday’s eurozone inflation print and Thursday’s US payrolls are the two events most likely to move the pair. EUR/USD may trade in a 1.13–1.15 range this week.
The week ahead: key data and central bank events
All times BST. Currency markets can move sharply around high-impact releases, so anyone with a near-term transfer should be aware of the schedule.
| Day | Event | Currency | Why it matters |
|---|---|---|---|
| Mon 29 Jun | ECB President Lagarde speech | EUR | Tone on further hikes after June’s move |
| Tue 30 Jun | UK first-quarter GDP (final) | GBP | Confirms the UK growth picture |
| Tue 30 Jun | US JOLTS job openings, consumer confidence | USD | Early read on US labour demand |
| Wed 1 Jul | Eurozone flash inflation (June) | EUR | Key test of how sticky inflation is |
| Wed 1 Jul | US ADP employment, ISM manufacturing | USD | Curtain-raisers for payrolls |
| Wed 1 Jul | BoE Governor Bailey speech | GBP | First steer since the June hold |
| Thu 2 Jul | US non-farm payrolls, average earnings | USD | The week’s biggest market mover |
| Thu 2 Jul | Swiss inflation | CHF | Relevant for CHF transfers |
| Fri 3 Jul | US markets closed (Independence Day) | USD | Thinner liquidity, sharper moves possible |
| Fri 3 Jul | BoE Governor Bailey speech; UK services PMI | GBP | Sterling sentiment into the weekend |
What this means for your transfer
The practical picture depends on which way you are moving money.
Buying euros — property in Spain, France, Italy or Portugal, or paying eurozone suppliers. The pound near 1.16 is close to the best level it has offered against the euro all year. With a resistance ceiling overhead and a forward curve pointing gently lower, the risk of waiting for “a bit more” is that the move never comes. You can compare the current level against the year’s range on our pound to euro forecast and GBP/EUR rate pages.
Buying US dollars — US property, USD invoices or dollar-denominated costs. A firm dollar makes this a more expensive moment than the start of the year, and payrolls on Thursday could move the rate by more than 1% in either direction. Our euro and dollar forecast covers the wider USD picture.
Bringing sterling home from abroad, or selling foreign currency. Sterling’s mixed performance — firmer against the euro, softer against the dollar — means timing matters more by pair than by date. A forward contract can remove the guesswork if your funds land on a fixed schedule.
UK businesses paying overseas suppliers. A data-heavy week is exactly when a fixed budget rate earns its keep. Locking a rate now protects margin regardless of how Thursday’s payrolls land. See our business currency support for how supplier payments are typically handled.
A note on timing and managing risk
In our experience working with property buyers across Spain, France and Italy, the most expensive mistake is not picking the wrong moment — it is leaving a large exposure open across a central bank decision or a payrolls release, hoping for a slightly better rate. Intraday swings of 1–2% around these events are not unusual, and on a property purchase that can change the cost by thousands.
There are several ways to manage that risk, each with trade-offs:
- A spot contract secures today’s rate for near-immediate settlement — simple, but it does nothing for a payment due in three months.
- A forward contract lets you fix today’s rate for a transfer up to around two years ahead. A forward contract is an agreement to exchange a set amount of currency at a fixed rate on a future date. It removes uncertainty, though it commits you to that rate even if the market later moves in your favour.
- A market order targets a specific rate and executes automatically if the market reaches it — useful when you have a level in mind but no fixed deadline.
Which of these fits depends entirely on your timeline and how much certainty you need. A specialist can walk you through the options so you can make your own informed decision — that is guidance, not a recommendation to take a particular action.
Frequently asked questions
What is the GBP/EUR forecast for this week?
GBP/EUR is forecast to trade in roughly a 1.15–1.17 range in the week beginning 29 June 2026, with the 1.1600 resistance level the key barrier. UK first-quarter GDP on Tuesday and eurozone inflation on Wednesday are the main triggers.
What is the GBP/USD forecast for this week?
GBP/USD is expected to trade around 1.31–1.34, with the pair under pressure from a strong US dollar. US non-farm payrolls on Thursday 2 July is the most significant event for the pair.
Why did the Bank of England hold rates at 3.75%?
The Monetary Policy Committee voted 7–2 to hold Bank Rate at 3.75% on 18 June 2026, judging that higher energy costs from the Middle East conflict had created uncertainty while the wider labour market was loosening. Two members preferred an immediate rise to 4%. The next decision is on 30 July 2026.
Why is the euro falling even though the ECB raised rates?
The ECB raised its deposit rate to 2.25% on 11 June 2026, but a hawkish US Federal Reserve and broad dollar strength have pushed EUR/USD lower regardless. In currency markets, the relative position of two central banks matters more than either one alone.
Is now a good time to buy euros?
The pound near 1.16 is close to its strongest level against the euro in 2026, which is favourable if you are buying euros, though the rate has repeatedly stalled at this level. Whether to act depends on your own timeline and budget — a specialist can talk you through the current level and your options.
How could the UK political situation affect the pound?
Sir Keir Starmer announced on 22 June 2026 that he intends to resign as Labour leader, with a leadership contest opening on 9 July. Political transitions can add short-term volatility to sterling, particularly when they coincide with major economic data, though they rarely set the currency’s direction on their own.
Does Cambridge Currencies handle transfers in any currency?
Cambridge Currencies arranges international transfers in all major and many minor currencies through its FCA-authorised partners, Currencycloud (FRN 900199) and ScioPay (FRN 927951). Every transaction is completed by phone with a dedicated specialist.
Speak to a specialist about your transfer
If you have a euro or dollar payment coming up this summer — a property completion, a supplier invoice or sale proceeds to bring home — it is worth understanding your options before the week’s data lands. Request a quote and a Cambridge Currencies specialist will talk you through the current rate, the events that could move it, and the tools available to manage the risk. Every transfer is handled by phone with a dedicated dealer who watches the market on your behalf — not an app — and arranged through our FCA-authorised partners, Currencycloud and ScioPay.
Related guides
- Pound to euro forecast 2026 — where GBP/EUR sits against its full-year range
- Currency forecasts hub — all our weekly and annual market analysis in one place
This article is general market commentary and guidance, not financial advice. Exchange rates can move quickly and past performance is not a guide to the future.
