Anna 
As anticipation builds for Thursday’s Bank of England (BOE) policy meeting, the British pound (GBP) has displayed a modest weakening trend. ING economists provide an insightful analysis of the pound’s future prospects and its potential interactions with other major currencies.
Eyes on EUR/GBP as 0.8700 Resistance May Prove Formidable
Despite the BOE’s 6:3 vote in favor of maintaining interest rates at their current levels, ING economists believe that this decision is unlikely to exert a significant influence on the pound’s performance. Nevertheless, it appears that market sentiment has adopted a somewhat less optimistic stance regarding the British currency.
Potential for GBP/USD Weakness Amid USD Strength
Should the U.S. dollar (USD) exhibit increased strength, there is a possibility that the GBP/USD currency pair could be pressured to move away from its support range between 1.2050 and 1.2100. The extent of this movement will be closely observed in the days ahead.
Challenges for EUR/GBP as Weak Eurozone Data Weighs
The pound’s counterpart, the euro, may also face challenges this week. Weak economic data emerging from the Eurozone suggests that the EUR/GBP currency pair could encounter difficulties in maintaining gains above the 0.8700 mark. The performance of this pairing will be a focal point in the evolving currency landscape.
In summary, ING’s assessment underscores the pound’s vulnerability in light of the BOE’s policy meeting and the potential repercussions of a stronger USD. The Eurozone’s economic data further adds complexity to the outlook, casting a shadow over the EUR/GBP pair’s ability to sustain gains above 0.8700. As market dynamics unfold, investors and traders will be closely monitoring these key factors.
