The British Pound has come under pressure against the Euro in May as investors bet Thursday's European Central Bank (ECB) interest rate decision and guidance will see it maintain its crown as the most hawkish of the major central banks.

The Pound to Euro exchange rate approached the year's highs last week and could attempt to reach its best levels since December 2022 if Euro area inflation ebbs again and the European Central Bank (ECB) adopts a less hawkish monetary policy stance in the days ahead. 

The Euro is in demand and this will likely remain the case into the early May ECB interest rate hike.

The Pound to Euro exchange rate steadied above its April low last week but whether it can recover by much this time out likely depends on how German inflation and economic growth numbers from Europe's major economies impact expectations for European Central Bank (ECB) interest rate policy.

Favourable April seasonality propels the Pound to its strongest valuation against a host of currencies since the start of the year, but momentum indicators look overbought and gains should fade says Bank of America.

The Pound to Euro exchange rate was pushed back to early February lows last week and the risk is that any attempted recovery is hampered this week by a renewed ebb of the inflation tide on Wednesday.

The British Pound could experience a setback as the Bank of England will surprise investors by keeping interest rates on hold in early May, according to a leading investment and commercial bank.

GBP/EUR near year's highs but with obstacles ahead.

GBP/EUR rallies continue to be frustrated by selling pressure that ultimately tends to dump the pair back into a well-trodden range.

The British Pound's outlook remains upbeat in the near term although headwinds will likely ensure the prospect for substantial gains remains limited, according to one of Europe's largest commercial and investment banks.

The Pound to Euro exchange rate has remained buoyant in upper half of its year-to-date range in recent trade but could find technical resistance levels in the 1.1387 to 1.1420 area continuing to frustrate its recovery in the week ahead. 

GBP/EUR could fall below 1.10 says Morgan Stanley, such levels are associated with 'crisis'.

Goldman Sachs says it is turning more constructive on the Pound's prospects amidst a broadly improved domestic environment, but it is still too soon to get outright positive.

EUR/GBP a sell this week says Crédit Agricole model, Equals Money notes GBP/EUR to be in an uptrend.

GBP/EUR attempting recovery of key average at 1.1389  

The Pound to Euro exchange rate reached three-month highs last week but could attempt to better those levels in the days ahead if the Bank of England (BoE) surprises with another increase in Bank Rate this Thursday. 

GBP/EUR has lacked any strong directional impulse in recent trade but could be volatile within its March range over the coming days.

The Pound to Euro exchange rate came close to 2023 highs before eventually being toppled last week but it could be likely to make a further attempt at returning to the 1.14 handle in the days ahead if the single currency is obliging and global market conditions are conducive. 

Improved sentiment saw Pound Sterling recover from its lowest levels since September and end February with a gain against the Euro, and March could see further gains according to some analysts we follow.

GBP appreciates sharply aided by strong PMI data as improved political climate also bodes well, say analysts.