£-€ records its biggest weekly gain since April 2025

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waterman

Written by Dan Waterman
March 6th 2026
GBP v EUR secures its first weekly gain since late January and hits a 1-month high doing it..

The Euro has lost nearly 2% versus the US Dollar since the Iran-US war started and is also at a fresh 10-year low versus the safe-haven CHF.

The Euro-Zone's heavy reliance on energy imports is the main reason for the €'s weakness, as higher energy prices leaves both industry and households exposed.

However, we believe the shock will be nowhere near what the situation was like when Russia first invaded Ukraine (mainly because of the EU's heavy reliance on Russia for energy at the time);

Natural gas is currently 84% lower than the 2022 peak
Oil is 34% lower
Electricity is 13% lower

GBP v EUR is barely up since the beginning of the war as the first two-days saw the pair fall by nearly 1% (standard safe-haven v high beta play). Therefore, we expect an 'easy' rebound shortly after this current war is over for the Euro, meaning the £-€ price right now is favourable (all things considered). 

GBP v USD is also expected to make a sharp comeback after losing just over 1% since the war began and is over 2% down now in the last month.

The Pound has been overall a 'net-loser' in the current environment across the board because of it's own heavy reliance on imported energy. But, if the BoE confirm no rate cut this month and a strong turnout in the vote to not, Sterling could improve in value immediately.