LONDON - Sterling rallied against the euro on Thursday amid a general drop in riskier currencies as investor anxiety intensified over the war in Ukraine.
In the absence of any major economic or policy news, the pound traded in a narrow range versus the dollar and by 1620 GMT sterling was 0.1% higher at $1.3143.
Versus the euro, sterling soared 0.7% to 84.33 pence, reversing some of the recent weakness that saw the British currency hit a three-month low in Asian trading hours.
The euro has rebounded in recent sessions against most currencies after a bruising month, as investors become a bit less concerned about the hit from the war in Ukraine on the euro zone economy.
But on Thursday, worries about Ukraine sent the single currency down across the board.
"It’s all very quiet in the UK today, both on the data side and in terms of Bank of England communication," said ING analysts in a research note.
"We see mostly downside risks from this point for the pair, but that should be a story for the coming weeks, as the euro’s good momentum could keep a floor under the pair for now."
