The pound euro (GBP/EUR) exchange rate is rising and is on track to gain 0.77% across the week.
The pound is rising after the BoE cut rates by 25 basis points to 4.75%, in line with expectations. However, BoE Governor Andrew Bailey warned over sticky inflation following the Labour government’s Budget.
The market has lowered rate cut expectations going forward, lifting GBP.
The euro is falling on concerns that trade tariffs from Trump could hurt an already fragile economic recovery.
The ECB could be forced to cut rates more aggressively to support the economy, which could weaken EUR further.