Sterling Weaker on Thursday as Market Focus Shifts to ECB Policy Announcement


Sterling weakened against the dollar in the London session on Thursday as the worsening economic outlook and political woes exerted pressure on the single currency. The market focus shifted to the European Central Bank (ECB) press conference later today.

As of press time, GBP trades at 1.2540 after rebounding from the 1.2500 level earlier today. The British pound also weakened against the euro today as the EUR/GBP pair held around its daily high near 0.8567 or +0.25%.

Commenting on the recent performance of Sterling, Simon Harvey, the head of FX Analysis at Monex Europe, noted that the EUR/GBP dynamics rely heavily on the ECB announcement later today. Harvey explained:

“We have the Bank of England that is naturally going to have to slow its hiking profile given economic conditions and the ECB that is about to start tightening monetary policy, with the risk it is going to have to be quicker in the short term than the market is currently pricing in.”

The controversial ECB policy announcement will be the major momentum driver in today’s trading session, with the central bank expected to announce an end to its multi-year long dovish monetary stance by halting its asset purchase program by the end of the month and announcing a rate hike for July, as the battle to tame worsening inflation intensifies.

EUR/GBP Shaves In- Day Loses Beyond as Focus Is on Lagarde and Eurozone Data

Sterling Under Political Pressure After Boris’ Vote of Confidence

Sterling also remained under pressure from the political uncertainty in the UK after British Prime Minister Boris Johnson won a confidence vote earlier this week. However, the PM did not win as many votes as many he might have hoped, highlighting a revolt against him within his own party.

Harvey detailed: “There is a case of waiting to see markets are very much hesitant to price up political risk. We still have some Brexit risk, and we also have some stability risk at play, so there is a direct impact on spot markets at the moment.”


You can purchase Lucky Block here. Buy LBlock

  • Broker
  • Benefits
  • Min Deposit
  • Score
  • Visit Broker
  • 20% welcome bonus of upto $10,000
  • Minimum deposit $100
  • Verify your account before the bonus is credited
$100 Min Deposit
  • Award-winning Cryptocurrency trading platform
  • $100 minimum deposit,
  • FCA & Cysec regulated
$100 Min Deposit
  • Over 100 different financial products
  • Invest from as little as $10
  • Same-day withdrawal is possible
$100 Min Deposit
  • Award-winning Cryptocurrency trading platform
  • 14 Cryptoassets available to invest in
  • FCA & Cysec regulated
$200 Min Deposit

Highly volatile unregulated investment products. No EU investor protection.

  • Trade top Cryptos such as Bitcoin, Litecoin and Ethereum plus more
  • Zero commissions and no bank fees on transactions
  • Around the clock service with support in 14 languages
$100 Min Deposit
  • The Lowest Trading Costs
  • 50% Welcome Bonus
  • Award-winning 24 Hour Support
$200 Min Deposit
  • Fund Moneta Markets account with a minimum of $250
  • Opt in using the form to claim your 50% deposit bonus
$250 Min Deposit
Share with other traders!

Azeez Mustapha

Azeez Mustapha is a trading professional, currency analyst, signals strategist, and funds manager with over ten years of experience within the financial field. As a blogger and finance author, he helps investors understand complex financial concepts, improve their investing skills, and learn how to manage their money.