The exchange rate has climbed to €1.128, up from a low of €1.118 just yesterday.
Sterling dived to its lowest level against the euro since November 2016 after comments from the Deputy Governor of the Bank of England (BoE).
Ben Broadbent told the Press and Journal there are too many “imponderables” in the British economy for him to consider a vote to to raise interest rates right now.
He said: “If you look at the past six to 12 months, economic growth has been okay and the employment rate good. Unemployment has drifted down a little … and inflation is higher.
“There is reason to see the committee moving in that direction (interest rate hike) – but there are still a lot of imponderables.
“In my opinion, it is a bit tricky at the moment to make a decision (to raise rates). I am not ready to do it yet.”
The exchange rate plummeted after Mr Broadbent’s comments, but it has since managed to turn its trajectory around.
This is largely owed to better than expected UK employment data as well as encouraging export figures post-Brexit vote.
TorFX currency analyst Laura Parsons said: “The GBP/EUR exchange rate briefly plummeted to €1.11 on Wednesday as Bank of England (BoE) Deputy Governor Ben Broadbent finally laid his cards on the table and came out in support of leaving interest rates on hold.
Government figures revealed last night showed the total value of UK goods and services sold overseas was a record £547.6 billion.
International Trade Secretary Liam Fox hailed the news as the latest evidence that Britain’s global trading links are already expanding ahead of the scheduled exit from the EU in 2019.
The exchange rate remains vulnerable to data out of the Eurozone today.
Ms Parsons said: “This morning Germany’s inflation data could cause further GBP/EUR exchange rate movement if initial estimates are revised.”
