FXStreet reports that economists at Danske Bank still believe sterling will strengthen this year and forecast the EUR/GBP pair at 0.85 on a six-to-twelve month view. 

“Near-term the economic outlook still looks grim amid the third national lockdown. However, the UK is vaccinating at a much faster pace than the rest of Europe, which, combined with the Brexit deal, means the UK is set to outperform the rest of Europe beyond Q1 21.”

“We expect the EUR/GBP to remain in the 0.87-0.88 range for now. We expect the cross to move lower when it gets more clear that the UK will exit the pandemic as one of the first countries, benefitting from its ‘first dose first’ strategy. We forecast EUR/GBP at 0.86 in three months and 0.85 in six-to-twelve months.”