

Market Analysis
The EUR/GBP currency pair continues its sideways consolidation during the first half of the European session on Monday, remaining within a familiar range established over the past week. Currently, spot prices hover around the 0.8365 mark, showing little change for the day as traders adopt a wait-and-see approach ahead of significant central bank events later this week.
The European Central Bank (ECB) is set to announce its policy decision on Thursday, with expectations of a third interest rate cut in this easing cycle due to growing concerns about sluggish economic growth. Additionally, inflation in the Eurozone has dipped below the ECB's 2% target for the first time since 2021, strengthening the case for further policy easing. This scenario puts downward pressure on the euro, creating a headwind for the EUR/GBP pair.
On the other hand, Bank of England (BoE) Governor Andrew Bailey recently indicated that the central bank could consider more aggressive rate cuts if inflation continues to show improvement. His comments have fueled speculation that the BoE may accelerate its rate-cutting cycle, which has deterred traders from making bullish bets on the British Pound (GBP). This development partially offsets the negative factors affecting the euro and provides some support for the EUR/GBP cross.
Given this mixed fundamental landscape, the prospects for a continuation of the subdued price action remain strong, particularly in the absence of any significant economic releases from the Eurozone or the UK. Therefore, it may be wise to await a clear directional movement before making any near-term trading decisions.
Paraphrasing text from "FX Street" all rights reserved by the original author.