Sterling struggling against the Euro at 1.15 to the Pound: "Wise to purchase currency now"

THE Pound is struggling against the Euro and way down from one year ago as experts advise it's "wise to purchase currency now".

Sterling is currently at 1.15 Euros to the Pound after briefly dropping to 1.14 in December. 

This is much lower than one year ago when it was 1.21 Euros to the Pound.

In contrast, Sterling is still trading at $1.35, its best level against the Dollar since September.

And the Pound is also looking strong against the Yen, at 211 Yen to the Pound – from 206 at the start of December.

Experts have shared why Sterling is struggling against the Euro and they offered some advice on mitigating the hit for holidaymakers.

Tony Redondo, Founder at Newquay-based Cosmos Currency Exchange, urged holidaymakers to purchase their foreign currency now.

He added: "The Pound has faced ‘death by a thousand cuts’ throughout 2025, dropping over 5% in value against the Euro as the Bank of England shifted from interest rate hawks to doves. 

"This change in stance reflects a new priority of encouraging economic growth over combating sticky inflation, especially as the UK economy stagnates under the weight of £70 billion in tax increases implemented since July 2024. Looking ahead, many analysts expect the Pound to fall a further 3–4% against the Euro in 2026. 

"For those with European travel plans in early 2026, it may be wise to purchase currency now or load a prepaid card to lock in current rates. Conversely, the United States currently offers better value for British travellers, with the Pound hitting a four-week high against the Dollar earlier this week."

Prem Raja, Head of Trading Floor at Currencies 4 You, offered some advice to holidaymakers heading to Europe.

He continued: "The Pound’s slide from 1.21 to 1.14 against the Euro is largely driven by a shifting interest rate landscape. While the post-budget "bullish" sentiment offered a brief reprieve, the outlook for 2026 favors the Euro; as the Bank of England prepares to cut rates to spur growth, the ECB’s commitment to stability makes the Euro more attractive to investors. 

"Globally, Sterling is holding its own against a weaker Yen and the Dollar, but the Eurozone remains a powerhouse. For those heading abroad, the 6% drop in purchasing power is significant, but a holiday in the UK isn't necessarily a ‘deal’ given high domestic inflation. 

"To mitigate the hit, travellers should avoid airport kiosks and use digital banks to capture the interbank rate, or use prepaid cards to lock in 1.14 before any further slippage. Ultimately, while your money won't go as far as last year, strategic planning in cheaper Mediterranean spots can still beat the cost of a premium UK staycation."

David Belle, Founder and Trader at Fink Money, said the Euro is now seen as a safe haven.

He added: “Sterling is under pressure vs Euro due to two main factors. 1) BoE is cutting far more aggressively than the ECB. The Euro is sort of a safe haven right now which is a strange concept. 2) we are now coming into real growth shock territory in the UK. 

"It’s feeding through to the market that UK growth a year out will be softer than previously thought. I don’t think people should forgo a holiday because Sterling is a little weaker. Sterling is broadly weaker across the board, except vs the Yen which I believe is down to the market pricing in Japanese rate increases a while ago.”