UK nominal effective exchange rate: narrow basket
UK nominal effective exchange rate: narrow basket stood at 106.09 in Aug 2026, according to Bank for International Settlements (BIS). It is one of the indicators in the Effective exchange rate table (Value · Monthly), with a complete series running from Jan 1964 to Aug 2026. The complete series with an interactive chart, free to download.
This indicator in the Effective exchange rate table
| Indicator | 08-2026 | 07-2026 | 06-2026 | 05-2026 | 04-2026 | 03-2026 | 02-2026 | 01-2026 | 12-2025 | 11-2025 | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Nominal, narrow basket (27 economies) | 106.09 | 106.2 | 105.17 | 105.06 | 104.69 | 104.69 | 104.65 | 104.88 | 104.19 | 103.17 | |
| Real, broad basket (64 economies) | 112.33 | 112.26 | 111.08 | 111.24 | 110.93 | 110.96 | 111.09 | 111.71 | 111.62 | 110.22 | |
| Nominal, broad basket (64 economies) | 112 | 111.74 | 110.6 | 110.87 | 110.61 | 110.73 | 110.89 | 111.14 | 110.6 | 109.48 |
Understanding UK nominal effective exchange rate: narrow basket
Evaluating the external value of the pound against a select group of twenty-seven trading nations, this metric aggregates exchange rates without incorporating any adjustment for relative inflation differentials. The calculation relies purely on market exchange rates combined with trade weights, ignoring how domestic versus foreign price levels erode or enhance purchasing power. By excluding inflation adjustments, this series captures immediate financial market perceptions and spot currency movements against key economic partners without the smoothing effect of price indices. The composition of this twenty-seven-country basket prioritises major bilateral trade flows while intentionally bypassing the extensive peripheral markets captured in broader variant rows.
Evaluating this nominal measure demands careful attention to currency market volatility, as financial sentiment can cause sharp monthly shifts that do not necessarily translate into changing trade competitiveness. Because no price adjustments are involved, revisions to early figures occur only when exchange rate data undergoes correction or when trade weights are rebased. Analysts must avoid comparing this nominal indicator directly with inflation-adjusted counterparts without acknowledging that inflation differentials can offset or amplify market exchange rate moves over time. Observing rolling averages helps filter out day-to-day foreign exchange noise when trying to identify structural shifts in currency value.
Frequently asked questions
- Does this nominal index account for cost-of-living differences abroad?
- No, it tracks purely unadjusted market exchange rates weighted by trade importance, leaving out all international price differential corrections.
- Why might this series move differently from its inflation-adjusted sibling?
- Divergent inflation rates between the United Kingdom and its trading partners can cause the real index to diverge significantly from this raw currency measure.
- How often do the underlying trade weights change?
- Weights are updated periodically to reflect shifting patterns in international trade shares across the designated partner economies.