EUR/GBP extends gains above 0.8600, eye on Fed, BoE decisions


  • EUR/GBP stays above 0.8600 ahead of the central banks’ decisions.
  • The Euro strengthened on the back of hawkish comments made by ECB President Christine Lagarde.
  • BoE is expected to increase interest rates by 25 basis points on Thursday.
  • BoE Governor Andrew Bailey indicated to approach the ending of interest rate-hike cycle.

EUR/GBP attempts to extend its gains on the second day, trading higher around 0.8610 during the European session on Monday. The pair might gain strength after the statement made by the European Central Bank’s (ECB) President Christine Lagarde on Friday.

Lagarde stated that ECB policymakers had not considered the possibility of implementing further rate cuts. The ECB’s President also suggested that the central bank’s intention was to maintain interest rates at elevated levels for an extended duration and was ready to increase rates if it was deemed necessary.

Economists at Commerzbank have analyzed the outlook for the Euro (EUR) following the ECB’s rate hike last week. According to their analysis, the central bank's decision to signal the end of rate hikes for the time being was largely in line with market expectations. This move by the ECB, however, comes with a certain level of risk, as it indicates a potentially less hawkish stance on monetary policy.

On the other side, the traders of cross-pair anticipate that the Bank of England (BoE) will raise interest rates by 25 basis points in the upcoming meeting scheduled for Thursday. This potential rate hike by the BoE reflects the central bank's efforts to address inflationary pressures and stabilize the British economy.

However, the BoE Governor Andrew Bailey has indicated that the central bank is getting closer to ending its series of interest rate increases. This statement, coupled with concerns about a potential recession and signs of a cooling UK labor market, may increase pressure on the BoE to pause its rate-hiking cycle.

In the upcoming week, there are significant events scheduled for the Eurozone. The Eurozone Harmonized Index of Consumer Prices (HICP) for August will be published on Tuesday and the preliminary HCOB Composite PMI for September is scheduled to be released on Friday. These datasets may provide insights into inflation trends in the Eurozone bloc, which could provide support for the EUR/GBP traders to place their bets.

EUR/GBP: additional important levels

Overview
Today last price 0.8613
Today Daily Change 0.0009
Today Daily Change % 0.10
Today daily open 0.8604
 
Trends
Daily SMA20 0.8572
Daily SMA50 0.8584
Daily SMA100 0.861
Daily SMA200 0.8712
 
Levels
Previous Daily High 0.8616
Previous Daily Low 0.8569
Previous Weekly High 0.8631
Previous Weekly Low 0.8558
Previous Monthly High 0.8669
Previous Monthly Low 0.8493
Daily Fibonacci 38.2% 0.8598
Daily Fibonacci 61.8% 0.8587
Daily Pivot Point S1 0.8577
Daily Pivot Point S2 0.855
Daily Pivot Point S3 0.8531
Daily Pivot Point R1 0.8624
Daily Pivot Point R2 0.8643
Daily Pivot Point R3 0.867

 

 

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