Euro Stabilizes as ECB Interest Rate Hike Bets Rise

The Euro has remained steady against the British Pound after experiencing volatility earlier in the day. The EUR/GBP currency cross is currently hovering around 0.8580, but may gain ground as the European Central Bank (ECB) prepares to make a decision on interest rates.

Traders expect the ECB to hike rates by 25 basis points to 2.5%, driven by surging energy prices due to the ongoing US-Iran conflict and Ukrainian attacks on Russian refineries. This would provide support for the Euro, making it more attractive for investors.

In a statement, Carsten Brzeski, global head of macro at ING, said that the ECB is likely to hike rates by 25 basis points, adding that 'another insurance rate hike' or a 'dovish rate hike' may be on the cards.