Snapshot: EUR/GBP remains heavily offered as monetary policy divergence between a cautious BoE and a dovish ECB dominates price action. While the ECB preserved its mild easing bias after cutting the deposit rate to 2.50%, sticky UK core inflation ticking up to 2.6% and services CPI near 5% keep the MPC highly reluctant to follow suit, cementing Sterling’s yield advantage.
- Stiff resistance at 0.8460 should cap any intraday retracements, with the 200bp BoE-ECB cash rate differential acting as a persistent magnet for Sterling buyers.
- The NY open brings risk-off spillover potential; if rising US yields push the VIX past 18.4, a broader cross-asset squeeze could temporarily cushion the Euro on safe-haven flows.
Bias into NY: Bearish EUR/GBP with eyes on a break toward 0.8400. High UK core inflation and a tight 4.9% unemployment rate will keep BoE rate cut expectations pushed back, while ECB speakers today reinforce Frankfurt’s easing path.