EUR / GBP bullish attempts remain capped below 0.9100

• EUR / GBP is stable above 0.9040 and capped below 0.9100.
• The pound remains on the defensive despite upbeat Brexit news.
• The pessimistic German business climate index adds pressure on the EUR.

The euro has moved back and forth against the pound, trading without a clear bias on Monday. He EUR/GBP remains steady in the upper 0.9000 range, with limited upside attempts below 0.9100 and risk aversion pushing both currencies lower against the USD.

Hopes for a Brexit deal ease GBP weakness

News reports on the extension of Brexit negotiations have boosted hopes for a trade deal between the UK and the EU and offered support for the British pound today. The pair lost ground during the London trading session to hit session lows at 0.9040.

According to newspaper headlines, EU Representative Michael Barnier will remain in London until Wednesday in an attempt to seal a trade deal with the UK to prevent a hostile exit from the Union.

On the macroeconomic front, the sharper-than-expected deterioration of the German business climate, with the IFO index falling back in October for the first time since the start of the pandemic, has increased concerns about the economic impact of the coronavirus, adding negative pressure on the euro.

The common currency, however, has found support at 0.9040 and cut daily losses to return to the 0.9080 zone and remain virtually unchanged on the day. From a broader point of view, the pair is consolidating gains after having appreciated almost 1% at the end of last week, although it appears unable to break above the 0.9100 level.