Euro Stalls Against Pound Amid Inflation Worries

The Euro trades flat against the British Pound as markets weigh the policy paths of the European Central Bank (ECB) and the Bank of England (BoE), balancing rising inflation with weaker growth.

Traders are awaiting key economic data, including UK GDP, German inflation and Retail Sales, followed by Eurozone inflation later this week. The EUR/GBP cross trades around 0.8578 after failing to reclaim the 0.8660 resistance area.

The ECB has raised interest rates twice this year, lifting the deposit facility rate to 2.50%, while the BoE has kept its Bank Rate unchanged at 3.75% for six consecutive meetings. Policymakers remain cautious as higher energy costs pose a risk to inflation and economic growth.