The intraday selling around the sterling picked up pace during the early European session and pushed the EUR/GBP cross to fresh daily tops, around the 0.8575-80 region in the last hour. The cross once again managed to find decent support and attracted some dip-buying near the 0.8545 region on Tuesday. This comes amid worries that the UK government’s decision to delay the final stage of easing lockdown measures to July 19 could hinder the nascent economic recovery. The combination of factors continued acting as a headwind for the sterling and assisted the EUR/GBP cross to erase a major part of the overnight losses.

On the other hand, the shared currency was weighed down by the emergence of some fresh buying around the US dollar. This, along with expectations for a hawkish shift by the Bank of England, might hold traders from placing aggressive bullish bets around the EUR/GBP cross and keep a lid on any further gains, at least for now. Hence, the key focus will remain on the upcoming BoE monetary policy meeting on Thursday. Meanwhile, the good two-way price moves over the past one week or so points to indecision over the next leg of a directional move. This, in turn, suggests that investors are likely to wait for a fresh catalyst before positioning for a firm direction.