- EUR/GBP attracted some dip-buying on Thursday and turned positive for the fourth straight day.
- A more hawkish ECB policy decision lifted the shared currency and remained supportive of the move.
- The worsening situation in Ukraine act as a headwind for the euro and cap gains for the cross.
The EUR/GBP cross caught some bids after the European Central Bank (ECB) announced its policy decision and shot to a fresh multi-week high, around 0.8435 region in the last hour.
The cross attracted some dip-buying near the 0.8375 region on Thursday and moved into the positive territory for the four successive sessions in reaction to a more hawkish ECB. As was widely expected, the Governing Council decided to leave key interest rates unchanged at the end of the March meeting. That said, the central bank said that it will conclude net purchases under the APP program in the third quarter and lifted bets for a 25 bps rate hike in October. This, in turn, was seen as a key factor behind the shared currency's relative outperformance against its British counterpart.
With the latest leg up, the EUR/GBP cross has rallied around 225 pips from the 0.8200 mark, or the lowest level since 2016 and seems poised to extend the week-long bullish trend. Acceptance above the 0.8400 round figure validates the positive outlook, though worries about the fallout from the worsening situation in Ukraine warrants some caution for aggressive bullish traders. In the latest development, negotiations between the Russian foreign minister and his Ukrainian counterpart broke down without any notable progress. This could act as a headwind for the shared currency.