EUR/GBP holds on to 0.8580 amid ECB cautious approach

The EUR/GBP price is keeping the trading nerve very tightly on Monday as the new trading week begins. The cross-currency pair is adhering to the prevailing downside momentum with no meaningful traction for the time being. 

At the time of writing, EUR/GBP trades at 0.8577, down 0.01% for the day.

The broader sentiment remains volatile ahead of the FOMC meeting later in the week. The Euro is under selling pressure after ECB left its rates unchanged and confirmed the bond purchasing program at a higher speed than the previous months, even though the central bank improved its forward guidance on inflation and growth.

In the latest development, ECB President Christine Lagarde said in an interview that the eurozone economy is on the right recovery path, still, it will be too early to talk about the tapering measures. This highlights the caution amid the policymakers, which weighs the performance of the Euro.

On the other hand, the British pound is relatively in a better position in terms of economic recovery and outlook. However, the Brexit concerns continue to haunt the cable on the fear of a probable trade war between the  UK and EU.

Meanwhile, experts believe that delay in economic re-opening by June 21 to another four weeks will likely have no impact on the sterling performance.

The Bank of England (BOE) has already hinted about the less accommodative monetary policy in the coming policy meetings.

The diverging stance on monetary policy makes GBP valuations attractive to investors as compared to the shared currency.

EUR/GBP additional levels