GBP/EUR: Gloomy Brexit News Weigh On Pound vs. Euro

The pound euro (GBP/EUR) exchange rate is edging higher, adding to gains from last week.

The pound is supported by hawkish BoE expectations, with the market pricing in a 5.75% peak rate. Economists are doubtful as to whether the central bank will be able to hike to this level.

UK CPI and the BoE interest rate decision are due this week and could set the tone for the pound going forward.

The euro is struggling despite the ECB hiking interest rates and pointing to more rate hikes to come.

Inflation cooled by more than expected in May to 6.1% from 7%.

This week PMI data on Friday is likely to be the key driver for the euro.