EUR/GBP remains above 0.8500 after rebounding from nine-month lows

The European Central Bank’s Isabel Schnabel suggested that Quantitative Easing may have impacted monetary policy transmission during the recent tightening cycle. In April, the annual inflation rate moderated to 2.3%, leading investors to reconsider expectations of a rate cut in June. The Pound Sterling strengthened as the Bank of England plans to keep rates higher for longer ahead of the UK general election. The EUR/GBP pair rebounded from a nine-month low, trading around 0.8520. Investors are awaiting inflation surveys for insights into the ECB’s monetary policy outlook. In the UK, inflation moderated to 2.3% in April, reducing the likelihood of a rate cut in June. The Pound Sterling is gaining momentum as the BoE is expected to maintain borrowing costs to address inflation. UK Prime Minister Rishi Sunak called for general elections on July 4, with analysts suggesting that this move could delay a BoE rate cut.