EUR/GBP holds its position above 0.8500 despite the dovish ECB


  • EUR/GBP experienced challenges as ECB officials suggested an interest rate cut in June.
  • ECB Chief Economist Phillip Lane said that “there is enough in what we see to start interest rate cuts.”
  • The Pound Sterling may struggle as moderated UK's annual inflation has tempered expectations of BoE’s rate cut in June.

EUR/GBP trades around 0.8510 during the early European hours on Monday, struggling due to dovish comments from European Central Bank (ECB) Chief Economist Philip Lane. In an interview with the Financial Times, Lane stated, “There is enough in what we see to start interest rate cuts. He thinks that they have been successful in getting inflation down in a timely manner and can move down somewhat within the zone of restrictiveness.

Additionally, ECB policymaker Piero Cipollone mentioned on Sunday that the time is right for an interest rate cut in June, as recent data has been favorable. Meanwhile, ECB President Christine Lagarde expressed confidence that Eurozone inflation is under control, indicating that an interest rate cut is likely next month.

On the data front, Germany's IFO Business Climate survey, which measures current conditions and business expectations, posted a reading of 89.3 for May. This falls short of the expected 90.3 and the previous 89.4.

In the United Kingdom (UK), the market is closed due to the Spring Bank Holiday on Monday. The Pound Sterling (GBP) received support as the traders digested lower-than-anticipated Retail Sales data released on Friday.

April saw a notable 2.3% decline in the monthly volume of sales of goods by retailers in the UK, far worse than the expected 0.4% downturn. On an annual basis, sales dipped by 2.7%, compared to the expected 0.2% decrease. Meanwhile, GfK Consumer Confidence softened to a reading of -17 in May, slightly better than the anticipated -18 reading and the previous -19.

However, the UK's annual inflation rate has moderated, edging closer to the Bank of England's (BoE) target of 2%. This moderation has tempered expectations of a rate cut in June among investors, which could put pressure on the Pound Sterling (GBP) and limit the downside of the EUR/GBP cross.

EUR/GBP

Overview
Today last price 0.8516
Today Daily Change 0.0000
Today Daily Change % 0.00
Today daily open 0.8516
 
Trends
Daily SMA20 0.8563
Daily SMA50 0.8565
Daily SMA100 0.856
Daily SMA200 0.8603
 
Levels
Previous Daily High 0.8532
Previous Daily Low 0.8512
Previous Weekly High 0.8568
Previous Weekly Low 0.85
Previous Monthly High 0.8645
Previous Monthly Low 0.8521
Daily Fibonacci 38.2% 0.852
Daily Fibonacci 61.8% 0.8524
Daily Pivot Point S1 0.8508
Daily Pivot Point S2 0.85
Daily Pivot Point S3 0.8488
Daily Pivot Point R1 0.8528
Daily Pivot Point R2 0.854
Daily Pivot Point R3 0.8548

 

 

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