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Investing.com - The euro-pound currency pair (EUR/GBP) rose slightly after an initial spike following "Liberation Day" subsided, according to a new analysis from UBS.
UBS analysts noted the recent movement was primarily driven by a stronger euro, though they expect the currency pair to remain rangebound in the coming months due to similar economic conditions in both regions.
Both the eurozone and the United Kingdom (TADAWUL:4280) should benefit from international investors seeking to diversify their U.S. dollar holdings, the investment bank said in its report.
UBS predicted that over time, the euro is likely to strengthen against the British pound, potentially pushing the currency pair toward the 0.86 mark.
The bank expressed confidence that geopolitical and trade risks affecting both currencies should eventually be overcome, allowing for this gradual euro appreciation against the pound.
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