EUR/GBP hovers around 0.8400, remains below over two-month high set on Monday

• EUR/GBP turns positive for the fifth straight day on Tuesday, though it lacks follow-through. 
• Stagflation fears and UK fiscal concerns continue to weigh on the GBP and support the cross.
• Traders look forward to a scheduled speech by BoE's Breeden for short-term opportunities.

The EUR/GBP cross attracts some dip-buyers on Tuesday and stalls the previous day's modest pullback from the vicinity of the 200-day Simple Moving Average (SMA), or a two-and-half-month top. Spot prices turn positive for the fifth successive day heading into the European session, with bulls looking to build on the intraday move-up beyond the 0.8400 mark. 

The British Pound (GBP) continues with its relative underperformance in the wake of the risk of stagflation - a combination of high inflation and weak economic growth. Furthermore, concerns over the UK's fiscal situation, amid a surge in UK borrowing costs, contribute to denting sentiment surrounding the GBP and turn out to be a key factor acting as a tailwind for the EUR/GBP cross. 

The shared currency, on the other hand, struggles to gain any meaningful positive traction on the back of the European Central Bank's (ECB) dovish bias and concerns about the faltering Eurozone economy. In fact, the ECB cut interest rates for the fourth time in December and left the door open to further easing in 2025. This, in turn, is holding back bulls from placing fresh bets around the EUR/GBP cross. 

Moving ahead, there isn't any relevant market-moving economic data due for release from the UK or the Eurozone on Tuesday. Hence, the focus will remain glued to the Bank of England (BoE) Deputy Governor Sarah Breeden's scheduled speech, which will influence the GBP and provide some meaningful impetus to the EUR/GBP cross.