After almost two decades of forex history, the GBP vs Euro pair is today one of the important major currency pairs in online trading. Both the Euro as well as the Pound have gone through tough times, as the European Union members have been struggling to tackle political and financial issues for over a decade, creating relative volatility in the GBP vs Euro pair.
GBP vs Euro – The 21stCentury Developments
The performance of both currencies has been affected by the financial crises in the European South and by the Brexit developments. This is why the Bank of England and the European Central Bank are going to great lengths to protect the two currencies from future threats.
The British Pound
The Pound is a currency that is over 800 years old. It is used as means of payment in the United Kingdom and many UK overseas territories. In terms of currency tradability, GBP is classified as a major currency. The decisions of the Monetary Policy Committee can affect the performance of the Pound in the forex market and for pairs such as the GBP vs Euro.
The British Pound has been affected by the developments regarding the Brexit and by the political uncertainty in the United Kingdom, during this transitional period of re-establishing the future relations between the United Kingdom and its EU-member neighbours in continental Europe and in Ireland.
Contrary to the Pound’s long history, the Euro is a relatively new currency. The Euro is the official or de facto currency in 22 countries; the 19 EU members and 3 non-EU countries. Despite being a very strong currency, some of the countries that have adopted the Euro as their official currency are struggling, because their economies were not strong enough to support it.
The Euro is one of the most traded currencies in the world, being second just behind the US Dollar. The most popular pairs containing the Euro as a variable are USD vs Euro, Euro vs JPY, GBP vs Euro and vice versa.
For pairs showing signs of volatility, such as GBP vs Euro, trading via CFDs is a good way to capture movement and momentum.