British Pound Nears Five-Month High Against Euro Amid Improved Risk Sentiment

On February 3, the British pound approached a five-month high against the euro, driven by improved risk sentiment and market calmness regarding the Bank of England's upcoming interest rate decision. According to Jin10, Antonio Ruggiero from Convera highlighted in a report that the positive correlation between the pound and risk sentiment has bolstered the currency. The pound's breakthrough of the 1.1550 resistance level against the euro further strengthened this trend. The market widely anticipates that the Bank of England will maintain its interest rates unchanged on Thursday. Ruggiero noted that pound bulls might perceive limited risk of the Bank of England adopting a more dovish stance on policy easing, with a low probability of more than two policymakers voting in favor of a rate cut.