EUR/GBP falls sharply to near 0.8600 ahead of UK CPI data

EUR/GBP drops swiftly to near 0.8600 ahead of UK Inflation data.
BoE Broadbent warned that higher wage growth could keep interest rates higher for a longer period.
ECB Villeroy signalled that the rate-tightening regime has come to an end.

Sagar Dua FXStreet

The EUR/GBP pair corrects sharply to near the round-level support of 0.8600 in the late European session. The cross faces a sell-off as investors hope that the Bank of England (BoE) will stick to tight interest rates due to higher wage growth.

UK’s labour cost index is consistently falling due to declining demand for workforce amid higher interest rates by the BoE. In spite of easing wage growth each month, pay hikes are higher than what required to bring down the underlying inflation to 2%.

BoE Deputy Governor Ben Broadbent said on Monday that higher wage growth could allow the central bank to keep interest rates in the restrictive territory for a longer period. In the monetary policy announcement, BoE Governor Andrew Bailey emphasized on keeping interest rates higher for sufficiently longer to ensure the achievement of price stability.

Meanwhile, investors await the UK Consumer Price Index (CPI) data for November, which will be published on Wednesday at 07:00 GMT. As per the consensus, monthly headline inflation grew by 0.2% after remaining stagnant in October. The annual headline and core inflation are seen easing to 4.4% and 5.6% respectively.

More-than-anticipated decline in the UK price pressures would escalate discussions about rate cuts by the BoE sooner in 2024.

On the Eurozone front, interest rates by the European Central Bank (ECB) are seen reaching to an end amid a significant decline in inflation. ECB Villeroy signalled that the rate-tightening regime has concluded now and rate cuts are expected at some time in 2024.

EUR/GBP

Overview
Today last price	0.8602
Today Daily Change	-0.0032
Today Daily Change %	-0.37
Today daily open	0.8634

Trends
Daily SMA20	0.8622
Daily SMA50	0.8669
Daily SMA100	0.8638
Daily SMA200	0.8662

Levels
Previous Daily High	0.8646
Previous Daily Low	0.8592
Previous Weekly High	0.8634
Previous Weekly Low	0.8549
Previous Monthly High	0.8766
Previous Monthly Low	0.8614
Daily Fibonacci 38.2%	0.8626
Daily Fibonacci 61.8%	0.8613
Daily Pivot Point S1	0.8602
Daily Pivot Point S2	0.857
Daily Pivot Point S3	0.8548
Daily Pivot Point R1	0.8656
Daily Pivot Point R2	0.8679
Daily Pivot Point R3	0.8711

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

EUR/USD steadies near 1.1650 ahead of US Nonfarm Payrolls

EUR/USD holds ground after five days of losses, trading around 1.1650 during the Asian hours on Friday. Traders remain cautious ahead of the US Nonfarm Payrolls report, which is expected to offer further insight into labor market conditions and the Federal Reserve’s policy outlook. December NFP is forecast to show job gains of 60,000, down from 64,000 in November.

GBP/USD: Further weakness could challenge 1.3400

GBP/USD remains under unabated selling pressure on Thursday, slipping to fresh three-day lows around 1.3415 in response to further improvement in the sentiment surrounding the Greenback ahead of Friday’s key NFP data.

Gold defends $4,450, looks to the crucial US NFP report

Gold struggles to capitalize on the previous day's goodish move up from the vicinity of the $4,400 mark and attracts some sellers while defending $4,450 in the Asian session on Friday. The critical US employment details will offer more cues about the Fed's rate-cut path, which, in turn, will influence the US Dollar price dynamics and provide a fresh impetus to the non-yielding bullion.

Forecasts for Payrolls are all over the place

Yesterday’s data put the kybosh on the idea the Fed needs to cut rates fairly urgently to protect the labor market. The jobs component of the ISM services index was nicely over 50, and that rising JOLTS voluntary quits rate also points to no real heartache in labor.

2026 economic outlook: Clear skies but don’t unfasten your seatbelts yet

Most years fade into the background as soon as a new one starts. Not 2025: a year of epochal shifts, in which the macroeconomy was the dog that did not bark. What to expect in 2026? The shocks of 2025 will not be undone, but neither will they be repeated.

XRP slides as institutional and retail demand falters

Ripple is trading down for the third consecutive day on Thursday amid escalating volatility in the cyrptocurrency market. After peaking at $2.41 on Tuesday, its highest print since November 14 amid the early-year rally, XRP has quickly ran into aggressive profit-taking.