- EUR/GBP eyes fresh upside above 0.8700 as ECB Lagarde sees inflation risks skewed upside.
- Eurozone’s headline and core inflation are seen softening to 4.5% and 4.8% respectively.
- The BoE unexpectedly paused interest rate hikes last week amid potential slowdown risks.
The EUR/GBP pair gathers strength to surpass the immediate resistance of 0.8700 in the late European session. More upside is anticipated in the cross as European Central Bank (ECB) President Christine Lagarde said that despite progress on inflation it is seen as too high for too long as the labor market has so far remained resilient.
This week, investors will focus on the Eurozone preliminary Harmonized Index of Consumer Prices (HICP) for September, which will be published later this week. The headline and core inflation are seen softening to 4.5% and 4.8% respectively.
The asset has been consistently moving higher for the past three trading sessions as the Bank of England (BOE) surprisingly paused the policy-tightening spell on Thursday while investors anticipated an interest rate hike by 25 basis points (bps).
BoE Governor Andrew Bailey skipped hiking interest rates after raising them consecutively for 14 times as higher interest rates have dampened the economic outlook. Labor demand has slowed as firms are focusing on achieving higher efficiency through controlling costs. Like Manufacturing PMI, Services PMI also landed below the 50.0 threshold consecutively for the second month, as per the preliminary S&P Global PMI report for September.
With a pause in the historically aggressive rate-tightening cycle by the BoE, the risks of a rebound in inflation and a slowdown in the growth rate have skewed to the upside. BoE policymakers came out with weak guidance on the Q3 Gross Domestic Product (GDP). The BoE conveyed that Q3 GDP now is expected to rise by a meager 0.1% (Aug: +0.4%), with underlying growth in H2 2023 likely weaker than forecast in August.
|Today last price||0.8695|
|Today Daily Change||-0.0001|
|Today Daily Change %||-0.01|
|Today daily open||0.8696|
|Previous Daily High||0.87|
|Previous Daily Low||0.866|
|Previous Weekly High||0.87|
|Previous Weekly Low||0.8599|
|Previous Monthly High||0.8669|
|Previous Monthly Low||0.8493|
|Daily Fibonacci 38.2%||0.8685|
|Daily Fibonacci 61.8%||0.8676|
|Daily Pivot Point S1||0.8671|
|Daily Pivot Point S2||0.8646|
|Daily Pivot Point S3||0.8631|
|Daily Pivot Point R1||0.8711|
|Daily Pivot Point R2||0.8726|
|Daily Pivot Point R3||0.8751|
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.