JP Morgan Research likes EUR/GBP upside in the near-term.

"Another crisis on Starmer's hands following a Guardian article which detailed how Mandelson's failed vetting was overruled by the Foreign Office, triggering a drop in gilts and sterling. Will this be the thing that finally de-thrones Starmer? During the last saga, also regarding Mandelson's appointment, we saw very little appetite from potential challengers to take the reins of Labour ahead of the May elections," JPM notes.

"We know that political flare-ups don't weigh on the pound for long, but happy to ride EURGBP higher for now as the story is pretty fresh and adds to the list of woes the UK is facing," JPM adds.