EU swing to the right means cheaper holidays for Brits! Euro plummets against the pound off the back of election results – meaning you’ll get more for your money this summer

The euro fell sharply overnight to its lowest level against the pound in almost two years, hit by the subsequent political uncertainty Elections for the European Parliament.

One euro was at one point worth 84.53 pence, after Eurosceptic nationalist parties made the biggest gains in Sunday’s elections. Emmanuel Macron called it a shocking parliamentary election, after the far right defeated the election.

It’s the lowest level since August 2022, and a boon for British holidaymakers heading to Europe this summer, who will get more for their money in the future. Eurozone.

The drop came after the French president suffered a humiliating defeat Marine Le Pen‘s National Rally party, which was projected to take home 31.5% of the vote.

Extreme right parties too achieved a series of high-profile victories elsewhere in the bloc, finishing first in France, Italy and Austria, coming in second Germany and the The Netherlandsas preliminary results show.

The euro fell sharply overnight after French President Emmanuel Macron called early parliamentary elections. This is a risky move that could lead to Marine Le Pen’s party (pictured) taking control of the French legislature.

The fall of the euro is a boon for British holidaymakers heading to Europe this summer, who will get more for their money in the eurozone

One euro was worth 84.53 pence at one point – the lowest level since August 2022

As the results came in, the euro also hit a one-month low against the dollar – down 0.44% to $1.0753 – and is now down more than 2.5% against the dollar this year.

French bond prices also fell after Macron’s decision to call early elections.

Yields rose to a two-week high of around 3.17%, while top stocks in Paris fell 2%, led by steep losses at lenders such as BNP Paribas and Societe Generale. The European benchmark STOXX 600 also fell 0.7%.

The battle for the euro provides a boost for British holidaymakers who want to travel to the eurozone this summer.

Every year millions of people leave the shores of Britain for the beaches of the Mediterranean or the sights of Europe’s historic cities.

Following the euro’s sharp fall against the pound, British tourists will see their money rise even further this year in countries such as Spain and Italy, which offer more affordable destinations for Brits compared to a ‘staycation’ at home.

With an uncertain political future ahead for Europe, experts have suggested the euro could remain turbulent.

Centre, liberal and socialist parties were expected to retain majorities after the election, but Eurosceptic nationalists made the biggest gains, raising questions about the major powers’ ability to steer policy in the bloc.

Making a risky gamble to restore authorityMacron called parliamentary elections after the results – with the first round on June 30.

If the far-right National Rally party wins a majority, Macron would no longer have a say in domestic affairs.

“That is probably somewhat bad news for the markets,” said Berenberg chief economist Holger Schmieding. ‘It introduces an unexpected element of uncertainty.’

Kathleen Brooks, research director at trading platform lay.

“The question for traders in the euro and European stock markets is how radical will Marine Le Pen and Jordan Bardella be if they do well in the French parliamentary elections?” she said, referring to two far-right leaders in France.

The gap between German and Italian government bonds, which investors see as a gauge of risk appetite in the broader region, also widened to 137 basis points.

“It is clear that the early elections are a new source of uncertainty, which should have a negative impact on economic and market confidence, at least in France,” said Jan von Gerich, chief market analyst at Nordea.

But he noted that EU election results do not always translate into domestic results, due to different voting systems and because EU elections tend to attract a larger protest vote.

Peter Cardillo, chief market economist at Spartan Capital Securities in New York, said it would take a huge wave of the far right for the euro to weaken substantially.

The European Central Bank made its first interest rate cut in five years last week and the currency has fallen almost 2.5% against the dollar this year, driven mainly by the relative prospects for interest rate cuts in the euro area and the United States.

In France, where concerns over the country’s high debt levels have increased, the implications of renewed political uncertainty for the economy could also be evident.

Standard & Poor’s cut its rating on France’s sovereign debt last month, delivering a stinging rebuke of the government’s handling of the tight budget days before the EU elections.

The drop came after the French president (pictured) suffered a humiliating defeat to Marine Le Pen’s National Rally party, which was projected to take home 31.5% of the vote.

More than 360 million Europeans from 27 countries were eligible to vote in the election of the 720-seat parliament.

The next parliament, and the next committee, will have to deal with Russia’s ongoing war in Ukraine, global trade tensions marked by US-China rivalry, a climate crisis and the prospect of a disruptive new Donald Trump presidency.

Following the results, Ursula von der Leyen, president of the European Commission, promised to “build a bastion against the extremes of the left and the right.”

Her center-right European People’s Party (EPP) scored first place.

As the EPP’s main candidate, Von der Leyen wants a second mandate to lead the committee.

EU leaders must start deciding as early as June 17 whether to make her choice or another, ahead of the June 27-28 summit.

Macron, meanwhile, called national parliamentary elections for June 30, a month before the Olympic Games in Paris.

“I cannot pretend that nothing has happened,” he said in a national address. The French people, he said, must now make “the best choice for themselves and future generations.”

Macron himself will see out the remainder of his current – ​​and final – presidential term, which ends in 2027, at which point Le Pen aims to succeed him.

The French drama added tension to an already tense day as votes were cast and counted, focusing attention on how well the far right was doing in each country.

In Germany, the EU’s largest economy, the scandal-plagued, fiercely anti-immigrant AfD party delivered gloomy news to Chancellor Olaf Scholz by defeating his Social Democrats by 16 to 14 percent.

The AfD – considered too extreme for Le Pen, who broke the alliance with her just before the elections – was kept in place by the opposition bloc CDU-CSU, which won 29.5 percent, while the Greens won 12 percent.

Members of the far-right AfD party cheer after the first exit polls were announced

The far-right parties in the Netherlands and Belgium both also gained ground, but fell short of the voter intentions attributed to them before the elections.

In Austria, the far-right Freedom Party led the Alpine country’s national elections for the first time, according to exit polls.

In Italy, Prime Minister Giorgia Meloni’s ruling post-fascist Brothers of Italy did better than predicted, coming out on top with 28 percent. The result made her one of the rare major European leaders to emerge stronger in the polls.

In Hungary, near-final results showed Prime Minister Viktor Orbán’s far-right Fidesz party on track for what could be the worst score in its 14-year rule: a still substantial 44 percent, but well below 52 percent she won in 2019.