The currency pair trades near 0.8540 as Sterling strengthens amid Iran-US maritime tensions and ahead of key inflation data.
EUR/GBP fell to 0.8545 on Tuesday, extending losses for a second day as geopolitical risks weighed on sentiment. The cross remains pressured by Iran’s blockade of the Strait of Hormuz and US countermeasures, including an attack on a Panama-flagged vessel attempting to cross the strait.
With no major Eurozone or UK data until Wednesday, the pair is driven by risk sentiment. Key catalysts ahead include Germany’s Harmonized Index of Consumer Prices (HICP) on Wednesday and UK preliminary GDP data on Thursday.
Technical indicators suggest further downside, with the pair trading below both the 100-period and 20-period SMAs on the 4-hour chart. The RSI near 37 signals lingering bearish momentum, while resistance levels at 0.8547 and 0.8551 cap potential recoveries.