EUR/GBP Trapped Below Key Technical Level Amid BoE Uncertainty

The EUR/GBP exchange rate is currently trading below the bottom of an ascending channel at around 0.8575, following declines on Thursday and Friday.

Despite a slight tick upwards for the Euro against the British Pound on Monday, the pair remains capped by this key technical level.

The uncertainty surrounding the Bank of England's (BoE) monetary policy is also putting downward pressure on the GBP, with analysts at TD Securities noting that last week's decision suggests the majority of the committee is still comfortable keeping rates on hold.

In this context, they believe the recent GBP rally should be faded against both the EUR and USD, and that further paring back of September BoE rate hike pricing could weigh on the pound.