EUR/GBP clings to modest daily gains above 0.88
- Political drama continues to weigh on the GBP.
- Uninspiring PMI data from Europe doesn't allow euro to gather strength.
- Coming up on Friday: Retail sales data from the UK.
The EUR/GBP pair dropped below the 0.88 handle today but didn't have a difficult time reversing its direction and moving into the positive territory. At the moment, the pair is trading at 0.8820, adding 0.16% on a daily basis. In case the pair finishes the day higher, its winning streak will increase to 17 days.
Earlier today, the shared currency came under pressure after the Markit Manufacturing PMI and Services PMI's preliminary readings for May came in below market expectations. Meanwhile, in its April 10 meeting minutes, the European Central Bank noted that recent data were even weaker than expected and that the inflation was "uncomfortably below" the bank's aim.
On the other hand, Sir Geoffrey Clifton-Brown, treasurer of the 1922 Committee, today claimed that British Prime Minister Theresa May would face a no-confidence vote if she does not announce her resignation date by this Friday. Although the PM's spokesman said that he was not aware of an announcement on Friday, markets are not expecting to PM May to remain in her position. Additionally, government whip Mark Spencer today said the vote on the Withdrawal Agreement Bill won't be taking place in the week starting June 3, confirming the lack of support for the deal. The latest chatter suggests that the PM is planning to rewrite the WAB.
On Friday, the UK's Office for National Statistics will publish the retail sales data and there won't be any macroeconomic data releases from the euro area.
Technical levels to consider
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
