EUR/GBP holds ground near 0.8750 ahead of Germany’s IFO Business Survey

EUR/GBP holds steady as both currencies rise after the US Supreme Court invalidated IEEPA tariffs without Congressional approval.
The EU trade chief said the European Union will suspend US trade deal ratification pending policy clarity.
The Pound Sterling gains ground following recent stronger-than-expected UK data.

Akhtar Faruqui FXStreet

EUR/GBP recovers its recent losses from the previous session, trading around 0.8740 during the Asian hours on Monday. Traders will monitor Germany’s IFO - Business Climate survey for February due later in the day.

The EUR/GBP pair remains largely unchanged as both the Euro (EUR) and the Pound Sterling (GBP) strengthen against the US Dollar (USD) after the US Supreme Court ruled that tariffs imposed under the IEEPA were unlawful without Congressional approval.

Following that, Trump signaled plans to introduce a new 15% global tariff under alternative trade laws, extending uncertainty around US trade policy. US Treasury Secretary Scott Bessent and other White House officials indicated that Washington would rely on different legal grounds to preserve as many of Trump’s existing tariffs as possible.

Meanwhile, the European Parliament’s trade chief said the European Union (EU) would propose suspending the ratification of its trade agreement with the US until it receives clearer guidance from the administration on its trade strategy, Bloomberg reported.

Stronger-than-expected United Kingdom (UK) data have provided additional support to the British Pound. Retail Sales surged by 4.5% year-over-year (YoY) in January, comfortably beating expectations of 2.8%. Meanwhile, business activity gained momentum, with the February S&P Flash Purchasing Managers’ Index (PMI) showing expansion across both the services and manufacturing sectors.

However, softer labor market figures have strengthened the case for additional policy easing by the Bank of England (BoE), as the unemployment rate rose in Q4 2025. Money markets are pricing in a strong likelihood, between 75% and 80%, that the Bank of England (BoE) will deliver a 25-basis-point rate cut at its March policy meeting.

Economic Indicator

IFO – Business Climate

This German business sentiment index released by the CESifo Group is closely watched as an early indicator of current conditions and business expectations in Germany. The Institute surveys more than 7,000 enterprises on their assessment of the business situation and their short-term planning. The positive economic growth anticipates bullish movements for the EUR, while a low reading is seen as negative (or bearish).

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