Sterling Hits Two-Month High Against Euro Amid Hopes For Better U.K.-EU Ties -- Market Talk

0825 GMT - Sterling's rise to a two-month high against the euro possibly reflects some independent euro weakness along with the prospect of improved U.K.-EU ties under U.K. Prime Minister Andy Burnham, ING's Chris Turner says in a note. The euro versus sterling is the usual hedge for eurozone political and fiscal concerns, he says. The widening spread between German and French government bond yields is quite alarming and potentially adding some risk premium to the euro and constraining the European Central Bank's tightening cycle, he says. Meanwhile, Burnham has suggested rejoining the EU as among the options to rebuild ties with the bloc, which would be positive for sterling, he says. The euro falls to as low as 0.8529 pounds.(renae.dyer@wsj.com)

(END) Dow Jones Newswires

October 01, 2026 04:26 ET (08:26 GMT)