The Euro remains resilient against the Pound at 0.8550s, supported by ECB rate hike signals despite broader market caution.
The Euro traded near three-week highs against the British Pound at 0.8550 on Tuesday, consolidating gains despite risk-off sentiment. GBP bulls stayed muted amid UK fiscal policy concerns and anticipation of the Bank of England’s upcoming meeting, where rates are expected to remain at 3.75%.
The European Central Bank’s hawkish stance, including a signaled September rate hike, bolstered the EUR. Meanwhile, declining oil prices following eased US-Iran tensions provided additional support. UK inflation projections near 3% may limit BoE tightening expectations, contrasting with the ECB’s approach.
Investors await BoE Governor Bailey’s comments for clues on future rate moves, with markets pricing in potential hikes later this year.