EUR/GBP extends decline to 0.8673 following upbeat UK data

The Euro extends losses against the Pound, reaching levels near 0.8670 to reverse Tuesday's rally.
UK Manufacturing activity beat expectations, and the GDP bounced up, improving the UK's economic outlook.
ECB member Pierre Wunsch said that the possibility of one more rate cut has receded,

Guillermo Alcala FXStreet

The Euro is trading lower for the second consecutive day, retracing most of the gains taken on Tuesday and reaching intra-day lows at 0.8673 as the Pound Sterling rallies on the back of stronger-than-expected UK manufacturing data.

Manufacturing production expanded at a 0.7% pace in August, beating expectations of a 0.4% growth and reversing a 1.1% decline in July, which has been upwardly revised from previous estimations of a 1.3% decline. Likewise, Industrial Production rose 0.4% following a 0.4% decline in the previous month and beating the market consensus of a 0.2% increase.

The Goods race balance also came out above expectations with a GBP 21.183 billion deficit, wider than the GBP 20,649 shortfall seen in July but better than the GBP 22.0 billion deficit expected.

The monthly Gross Domestic Product edged up 0.1% in August, as expected, reversing the 0.1% contraction seen in July.

In the Eurozone, the governor of the Belgian Central Bank and ECB's committee member, Pierre Wunsch, affirmed that he is not uncomfortable with bets of one further ECB cut, but that the probability of that scenario has been receding. Later in the day, ECB President Christine Lagarde is likely to give further insight into the central bank's monetary policy plans.

Economic Indicator

Manufacturing Production (MoM)

The Manufacturing Production released by the National Statistics measures the manufacturing output. Manufacturing Production is significant as a short term indicator of the strength of UK manufacturing activity that dominates a large part of total GDP. A high reading is seen as positive (or bullish) for the GBP, while a low reading is seen as negative (or bearish).

Economic Indicator

Gross Domestic Product (MoM)

The Gross Domestic Product (GDP), released by the Office for National Statistics on a monthly and quarterly basis, is a measure of the total value of all goods and services produced in the UK during a given period. The GDP is considered as the main measure of UK economic activity. The MoM reading compares economic activity in the reference month to the previous month. Generally, a rise in this indicator is bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.

EUR/USD climbs to daily highs near 1.1820

EUR/USD now picks up pace and advances to the area of daily peaks north of the 1.1800 barrier at the end of the week. The pair’s decent move higher comes against the backdrop of a generalised lack of direction in the FX galaxy and the mild offered stance in the US Dollar.

GBP/USD trims losses, retests 1.3460

After briefly challenging its key 200-day SMA near 1.3440, GBP/USD now manages to regain some balance and revisit the 1.3460 zone on Friday. Cable’s pullback comes as the selling pressure on the Greenback gathers traction, reigniting some recovery in the risk-linked space.

Gold flirts with four-week highs past $5,200

Gold extends its rebound, climbing for a third consecutive session and pushing back above the $5,200 mark per troy ounce on Friday. The move higher continues to draw support from lingering geopolitical tensions and the ongoing uncertainty surrounding US trade policy, both of which are keeping safe-haven demand firmly in play.

Bitcoin, Ethereum and Ripple consolidate with short-term cautious bullish bias

Bitcoin, Ethereum and Ripple are consolidating near key technical areas on Friday, showing mild signs of stabilization after recent volatility. BTC holds above $67,000 despite mild losses so far this week, while ETH hovers around $2,000 after a rejection near its upper consolidation boundary.

Changing the game: International implications of recent tariff developments

The Supreme Court ruling on International Emergency Economic Powers Act (IEEPA) tariffs provides limited relief for the rest of the world, with weighted average tariff rates modestly lower.

Starknet unveils strkBTC, shielded Bitcoin transactions on Ethereum Layer 2

Starknet, the Ethereum Layer 2 network developed by StarkWare, today announced strkBTC, a wrapped Bitcoin asset that introduces optional shielding while preserving full DeFi composability.