GBP: Holding steady into the budget – ING

EUR/GBP is holding support near 0.8760–0.8770 ahead of the UK budget, with sterling’s upside constrained and some downside risk if the 2026 BoE easing cycle is under-priced, ING's FX analyst Chris Turner notes.

EUR/GBP finds support ahead of UK budget

"On Friday, we estimated that the risk premium – or where EUR/GBP and 10-year Gilts should be trading relative to typical financial variables – was at around 0.5% and 10bp, respectively. Our baseline going into Wednesday's budget is that sterling's upside is probably quite limited on a credible/tight budget and that there is some sterling downside on the view that the 2026 Bank of England easing cycle is under-priced."

"We favour EUR/GBP again finding support in the 0.8760/70 area pre-budget."