EUR/GBP Drops After UK Inflation Surprise
The EUR/GBP pair went down a little after moving above 0.8650. This happened because the UK inflation report was stronger than expected. It made the market react quickly.
UK Inflation Rises to 3.6%
In June 2025, the UK’s inflation (CPI) increased to 3.6%. In May, it was 3.4%. Prices for petrol, flight tickets, and train fares went up. Core inflation, which doesn’t count food and energy, also stayed high. This means prices in the UK are still rising fast.
What This Means for the Bank of England
The Bank of England (BoE) wants inflation to come down to 2%. But with prices rising, the BoE may not cut interest rates soon. This gave some strength to the British Pound (GBP), and that’s why EUR/GBP came down a bit.
How the Market Reacted
Before this, the Euro was doing better because the European Central Bank (ECB) had a clear policy. But now, with high UK inflation, traders are watching both BoE and ECB closely. This has added more movement to the EUR/GBP live rate.
Impact :
EUR/GBP could go up again if BoE delays rate cuts. But if UK inflation falls next month, the Pound might weaken, and EUR/GBP could drop.