Boost for pound as trade war fears hit euro – sterling rises above €1.21 for first time since March 2022

British tourists will get more bang for their buck on the continent this winter as the pound soars against the euro.

In a boost for families planning ski trips and other getaways to Europe, sterling surpassed 1.21 euros for the first time since March 2022.

The euro also fell to $1.06 against the dollar – its lowest level since April – and analysts warn that the two currencies are heading towards “parity”.

A British tourist who exchanged £500 at €1.21 would get €605, compared to €550 after the autumn 2022 mini-budget, when the pound fell to €1.10.

A €200 ski pass in the French Alps would now cost £165, up from £175 last winter.

The pound has recovered against the euro amid fears that tariffs imposed by Donald Trump when he returns to the White House will hit the European economy hard.

Trump has threatened to impose tariffs on all imports to the United States, but there is speculation Britain could avoid the measures through a trade deal.

ING analyst Chris Turner said the UK “may not be at the center of the looming trade war”.

The prospect of Britain doing better than the eurozone in such circumstances helped push the pound higher.

A report from Goldman Sachs analysts said the hit to the eurozone economy from US tariffs could see the euro fall “below parity” against the dollar.

‘On the contrary, the report describes the pound as ‘a diamond in the rough.’