GBP/EUR: Brexit Extension & EU Trade Tariffs In Focus

The pound euro (GBP/EUR) exchange rate is rising after losses last week.

The pound fell sharply last week after the BoE interest rate decision was more dovish than expected.

The pound is recovering even as the UK economic outlook remains gloomy, with a recession expected across 2023.

The euro rose last week after a hawkish sounding ECB, which pointed to more interest rates rises i the coming year.

German IFO business sentiment has improved in December, rising to 88.6, up from 86.3.

Business morale has improved as the risk of gas rationing has eased and as inflation eases.