Euro Edges Ahead of Pound on Hopes of Hormuz Ceasefire

The Euro is gaining against the British Pound due to hopes of a de-escalation in the Gulf region. A reported ceasefire between Washington and Tehran could restore free navigation through the Strait of Hormuz, which carries about a fifth of the world's oil and liquefied natural gas.

This development is seen as positive for the energy-importing Euro area, with potential softer fuel costs. The EUR/GBP pair has broken above its 20- and 100-period moving averages and is testing the session high at 0.8574.

Russian agency RIA Novosti reported on Tuesday that an announcement of the ceasefire was expected in the coming days. However, traders are waiting for formal confirmation before pricing it in fully.