Euro Gains Against Pound as Market Bets on Dovish Bank of England

The European Central Bank's (ECB) decision to keep its interest rates steady has led to a shift in market expectations, benefiting the Euro. Against the Pound Sterling, the Euro has gained for eight out of nine sessions, with the spread between their deposit rates remaining unchanged.

The Bank of England's (BoE) upcoming meeting on Thursday will be crucial in determining the future direction of the Pound. The BoE is expected to hold its interest rate at 3.75%, but a vote split or a surprise decision could have significant implications for the currency.

Despite the UK's strong economy, the Pound has been under pressure due to rising government yields and borrowing above forecast. A recent survey of investment banks showed that a majority expected the Euro-Pound cross to return to the 0.8700-0.8900 range by 2027.