EURGBP Nudges Higher; Ignores Weak EZ Sentiment Data
EURGBP News and Talking Points
- EURGBP pulls back marginally after hitting an eleven-month low.
- UK and EZ inflation data will be closely eyed on Wednesday.
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EURGBP Bounces Off Low But Reprieve May Prove Fleeting
Business sentiment in Germany fell sharply, ZEW data showed Tuesday, while Euro-Zone economic sentiment hit a five-and-a-half year low as the ongoing international trade dispute and the latest actions in Syria weighed on businesses. The single currency however shrugged off the double dose off bad news and moved back off its 11 month low against GBP of 0.86257, albeit marginally.
Earlier in the day, data from the Office for National Statistics showed UK employment hitting a record high while UK unemployment fell to its lowest level since 1975. Wage data showed UK wages rising above inflation for the first time in around a year – 2.8% vs. 2.7%.
EURGBP will be watched closely again on Wednesday when UK and Euro-Zone inflation data hits the screens. UK consumer prices are expected to remain unchanged at 2.7%, with the potential for a slightly lower outturn, while the final Euro-Zone number is expected to remain unchanged at 1.4%, well below the ECB’s target rate of around 2%. The European Central Bank is struggling to stoke inflation in the single-block, despite buying in excess of EUR2.3 trillion of government debt in an effort to kick-start the economy and boost prices.
EURGBP may still move lower with the May 2017 and December 2016 lows between 0.8300 and 0.83150 the likely next downside target.
We will covering the UK Inflation Release from 09:15 am live on Wednesday April 18.
EURGBP Weekly Price Chart (August 2014 – April 17, 2018)
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--- Written by Nick Cawley, Analyst
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.