Pound Tumbles as ECB Hike Bets Send Euro Soaring

The Pound to Euro exchange rate took a hit on Wednesday as investors increased their bets on a European Central Bank interest rate hike in September.

This move boosted the Euro, causing it to firm up against the Pound, which was already under pressure due to concerns about the rising cost of living in the UK.

Comments from ECB policymaker Isabel Schnabel, who said interest rates must rise further amid the ongoing US-Iran war and upside inflation risks posed by the strong Eurozone economy, contributed to the strengthening of the Euro.

The Pound lacked fresh domestic support on Wednesday, with news that the energy price cap will rise again in October fueling concerns about how this will impact household incomes and the British economy.