EUR/GBP Price Forecast: Euro languishes near eight-month lows at 0.8610

The Euro (EUR) edges up against the British Pound (GBP) on Friday, trading at the 0.8630 area at the time of writing after dropping from Thursday’s highs at 0.8670, but remains dangerously close to the eight-month lows of 0.8610.

The common currency accelerated its downtrend on Thursday following monetary policy decisions by the European Central Bank (ECB) and the Bank of England (BoE). Both central banks left rates unchanged, as widely expected, awaiting more clarity on the impact of the US-Iran war on inflation and economic growth.

ECB’s President Christine Lagarde showed a rather hawkish view, which has been endorsed by the Bundesbank President and ECB committee member Joachim Nagel, hinting at a rate hike over the coming months. BoE Governor Andrew Bailey, on the contrary, was more ambiguous about monetary tightening. The market, however, reacted by selling the Euro against the Pound.