The pound euro (GBP/EUR) exchange rate is rising to a 3-week high amid EUR weakness.
The EUR is under pressure after rating agency Fitch lowered France’s credit rating to A+ from AA-.
Fitch cited concerns over rising debt levels and political instability. This comes as new Prime Minister Lecornu faces an almost impossible task of drafting spending cuts for the 2026 Budget.
French bond yields have surged, although the CAC also trades 1% higher.
The pound is rising ahead of a busy week with unemployment, CPI, and retail sales data, as well as the BoE rate decision.
The BoE is expected to leave rates unchanged amid sticky inflation and despite weak growth.
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