The British pound faces renewed pressure following the Green Party's victory in the Gorton and Denton by-election, a seat previously held by Labour in Manchester. This result, seen as a blow to Prime Minister Keir Starmer's authority, has intensified concerns about political stability and potential shifts in government policy.

Analysts note the win signals possible vulnerability for Labour in future contests, potentially impacting the government's legislative agenda and fiscal plans. The currency pair EUR/GBP rose 0.03% to 0.8752 against sterling, while GBP/USD gained 0.04% to 1.3491 as of 09:34 GMT. ING maintains a bullish stance on EUR/GBP, citing ongoing political uncertainty and fiscal concerns ahead of the budget announcement as key factors keeping the currency pair near its short-term target of 0.880.