The pound has come under some pressure this week but is definitely showing much better resilience compared to other European currencies like the euro and Swedish krona. The EUR/GBP pair could extend its losses if EUR/USD fails to hold the 1.10 level, according to economists at ING.
See: EUR/SEK to hit 11.00 if Europe takes steps to curb imports of Russian commodities – ING
Market continues to price in five 25bp rate hikes by the BoE this year
“The market continues to price in five 25bp rate hikes by the Bank of England in 2022, which has prevented the kind of re-pricing seen in EUR markets.”
“A decisive break below 1.1000 in EUR/USD could favour another drop in EUR/GBP, which could explore the 0.8200-0.8250 area in the coming days.”