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The pound-euro (GBP/EUR) exchange rate is flat on Friday but rose modestly over the week.

The pound is holding near multi-month highs despite stronger-than-expected UK borrowing data, which highlights rising fiscal pressures.

Government borrowing reached £14.3 billion in February, driven by debt interest payments and rising inflation expectations linked to higher energy prices.

A more hawkish Bank of England has pushed gilt yields higher, prompting markets to consider potential rate hikes.

The euro is steady after recent losses, supported by a slight pullback in oil prices. The ECB kept rates unchanged but adopted a more hawkish tone, signalling it stands ready to act amid rising inflation risks from elevated energy prices.