I have a trip to Paris coming up and it’s prompted me to check out the current exchange rate on the excellent X-Rates site. As you’ll see if you click on that link, Sterling has been falling over the last month or so.

As I wrote a few months ago, the Pound had improved both against the Euro and the Dollar during the summer months, which was good news for those of use on holiday there. It didn’t reach the highs of 2008, but it had improved since last winter. However, during August and particularly in September, a lot of the ground the Pound had made up was lost against both currencies. The pound is currently worth €1.09, from a high during the summer of €1.18, making travelling to Europe very expensive for us Brits.

I believe the reason for the Pound’s decline is the fact that the UK is still in recession whereas the powerhouses of Europe, Germany and France, have successfully grown their economies. Hopefully we will see in the next few months Britain exit from recession, and then the Pound will become a more attractive currency for investors, making it stronger and (importantly) worth more.

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Foreign Currency

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