{"id":14836,"date":"2025-07-28T02:31:23","date_gmt":"2025-07-28T02:31:23","guid":{"rendered":"https:\/\/lotayamedia.xyz\/?p=14836"},"modified":"2025-07-28T02:31:23","modified_gmt":"2025-07-28T02:31:23","slug":"pound-sterling-under-pressure-mufg-predicts-gbp-eur-slide-to-1-13-amid-fiscal-concerns","status":"publish","type":"post","link":"https:\/\/lotayamedia.xyz\/?p=14836","title":{"rendered":"Pound Sterling Under Pressure: MUFG Predicts GBP\/EUR Slide to 1.13 Amid Fiscal Concerns"},"content":{"rendered":"<p class=\"ds-markdown-paragraph\">The\u00a0<strong>Pound Sterling (GBP)<\/strong>\u00a0faced renewed selling pressure this week, with the\u00a0<strong>GBP\/EUR exchange rate<\/strong>\u00a0tumbling to\u00a0<strong>three-month lows near 1.1440<\/strong>. Analysts at\u00a0<strong>MUFG<\/strong>\u00a0remain bearish on the UK currency, maintaining their forecast of a further decline to\u00a0<strong>1.13<\/strong>\u00a0in the coming months.<\/p>\n<h2><strong>ECB Rate Hold Strengthens the Euro<\/strong><\/h2>\n<p class=\"ds-markdown-paragraph\">The\u00a0<strong>European Central Bank (ECB)<\/strong>\u00a0kept interest rates steady at\u00a0<strong>2.00%<\/strong>\u00a0in its latest meeting, with sources indicating that rates are likely to remain unchanged in\u00a0<strong>September<\/strong>\u00a0(<em><a href=\"https:\/\/www.reuters.com\/markets\/rates-bonds\/ecb-holds-rates-firm-signals-prolonged-pause-2024-07-25\/\" target=\"_blank\" rel=\"noopener noreferrer\">Reuters<\/a><\/em>). This shift in expectations has bolstered the\u00a0<strong>Euro (EUR)<\/strong>, adding to Sterling\u2019s struggles.<\/p>\n<h2><strong>Bank of England Rate Cut Expectations Weigh on GBP<\/strong><\/h2>\n<p class=\"ds-markdown-paragraph\">Markets are pricing in a near-certain\u00a0<strong>interest rate cut by the Bank of England (BoE) in early August<\/strong>, a move that MUFG and other major investment banks fully anticipate (<em><a href=\"https:\/\/www.bloomberg.com\/markets\/rates-bonds\" target=\"_blank\" rel=\"noopener noreferrer\">Bloomberg<\/a><\/em>. The latest\u00a0<strong>UK PMI data<\/strong>\u00a0revealed:<\/p>\n<ul>\n<li>\n<p class=\"ds-markdown-paragraph\"><strong>Slowing services-sector growth<\/strong><\/p>\n<\/li>\n<li>\n<p class=\"ds-markdown-paragraph\"><strong>Further job losses<\/strong><\/p>\n<\/li>\n<li>\n<p class=\"ds-markdown-paragraph\"><strong>Rising cost pressures<\/strong><\/p>\n<\/li>\n<\/ul>\n<p class=\"ds-markdown-paragraph\">With\u00a0<strong>labor market weakness<\/strong>\u00a0persisting, MUFG expects\u00a0<strong>multiple BoE rate cuts this year<\/strong>, eroding the Pound\u2019s\u00a0<strong>yield advantage<\/strong>\u00a0over the Euro.<\/p>\n<h2><strong>Inflation and Fiscal Risks Compound Sterling\u2019s Woes<\/strong><\/h2>\n<p class=\"ds-markdown-paragraph\">Despite signs of\u00a0<strong>sticky inflation<\/strong>, the BoE\u2019s dovish tilt could further damage GBP sentiment. Additionally, MUFG highlights\u00a0<strong>underlying fiscal vulnerabilities<\/strong>, with potential\u00a0<strong>tax hikes in the Autumn Budget<\/strong>\u00a0likely to suppress consumer spending and business investment (<em><a href=\"https:\/\/www.ft.com\/markets\/currencies\" target=\"_blank\" rel=\"noopener noreferrer\">Financial Times<\/a><\/em>.<\/p>\n<h3><strong>Key Takeaways for GBP\/EUR Outlook<\/strong><\/h3>\n<ul>\n<li>\n<p class=\"ds-markdown-paragraph\"><strong>Bearish GBP forecast (1.13 target)<\/strong>\u00a0as BoE easing cycle begins<\/p>\n<\/li>\n<li>\n<p class=\"ds-markdown-paragraph\"><strong>ECB\u2019s steady stance supports EUR<\/strong><\/p>\n<\/li>\n<li>\n<p class=\"ds-markdown-paragraph\"><strong>UK fiscal concerns add downward pressure<\/strong><\/p>\n<\/li>\n<li>\n<p class=\"ds-markdown-paragraph\"><strong>Persistent inflation may not save Sterling<\/strong>\u00a0if rate cuts proceed<\/p>\n<\/li>\n<\/ul>\n<p class=\"ds-markdown-paragraph\">For real-time FX updates, follow\u00a0<strong><a href=\"https:\/\/twitter.com\/fxstreetnews\" target=\"_blank\" rel=\"noopener noreferrer\">@fxstreetnews<\/a><\/strong>\u00a0or track live rates via\u00a0<strong><a href=\"https:\/\/www.investing.com\/currencies\/gbp-eur\" target=\"_blank\" rel=\"noopener noreferrer\">Investing.com<\/a><\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The\u00a0Pound Sterling (GBP)\u00a0faced renewed selling pressure this week, with the\u00a0GBP\/EUR exchange rate\u00a0tumbling to\u00a0three-month lows near 1.1440. Analysts at\u00a0MUFG\u00a0remain bearish on &#8230;<\/p>\n","protected":false},"author":1,"featured_media":14837,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"rank_math_title":"","rank_math_description":"","rank_math_focus_keyword":"","rank_math_keywords":"","footnotes":""},"categories":[16,2],"tags":[],"class_list":["post-14836","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-marketing"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts\/14836","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14836"}],"version-history":[{"count":1,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts\/14836\/revisions"}],"predecessor-version":[{"id":14838,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/posts\/14836\/revisions\/14838"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=\/wp\/v2\/media\/14837"}],"wp:attachment":[{"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14836"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14836"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lotayamedia.xyz\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14836"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}