The pound euro (GBP/EUR) exchange rate is rising, recovering from a two-month low yesterday.
The pound is edging higher after Tuesday’s drop on weak UK PMI data as confidence fades ahead of the Budget.
The OECD warned that the UK will face the G7’s highest inflation this year, due to payroll taxes, minimum wage hikes, and regulated price rises, with inflation expected to stay above 2% in 2026. Still, UK growth is forecast at 1.4% in 2025.
Meanwhile, the euro softened after German business sentiment fell to 87.7 in September, down from 89. However, stronger PMI data and OECD forecasts offered some optimism.