EUR/GBP to rise toward 0.89 in 2024 – Danske Bank

At today’s monetary policy meeting, the Bank of England (BoE) left the key policy rate unchanged at 5.25%. EUR/GBP ended the meeting higher. Economists at Danske Bank analyze Sterling’s outlook.

BoE paves the way for more EUR/GBP topside 

As expected, the BoE decided to keep the Bank Rate (key policy rate) unchanged at 5.25% whilst maintaining a data dependent forward guidance. 

We continue to see relative rates as a moderate positive for EUR/GBP with room for further cuts being priced in for 2024. 

We still expect the relative performance of the Euro area and the UK economy to be a relevant driver. 

We target a modest rise in EUR/GBP to 0.89 in 2024.