EUR/GBP rises on France-UK nuclear pact amid European defense concerns

EUR/GBP has gained 0.2% to 0.8435 as markets digest the strategic defense agreement between France and the UK to coordinate nuclear deterrence strategies against major European threats. The unprecedented military cooperation announcement has sparked safe-haven flows into European assets, with the euro benefiting from France's central role in EU defense policy. Sterling faced headwinds despite UK involvement, as traders weighed potential defense spending implications and fiscal pressures. The geopolitical development comes amid heightened tensions in Eastern Europe and ongoing concerns about regional security. Technical indicators show EUR/GBP testing resistance at 0.8450, with support established at 0.8400. The pair's 50-day moving average at 0.8425 now acts as dynamic support. Traders are monitoring further diplomatic developments and potential NATO responses, which could drive additional volatility in European currency pairs throughout the week.