- EUR/GBP gains momentum above the 0.8540 mark on Monday.
- The annual German Producer Price Index (PPI) for July fell to -6% versus of -5.1% expected.
- Markets anticipate that the Bank of England (BoW) will maintain a tightening cycle.
- Investors await Eurozone, UK S&P PMI data for fresh impetus.
The EUR/GBP holds positive ground near 0.8545 heading into the early European session on Friday. The cross trades in positive territory for the second consecutive day. Market players await the inflation data from both UK and Eurozone for fresh impetus.
The latest data on Monday by the Statistisches Bundesamt Deutschland reported that the annual German Producer Price Index (PPI) for July fell to -6% versus a 0.1% increase and worse than the market expectation of -5.1%. The monthly PPI figure declined to -1.1% against the market consensus of -0.2% and -0.3% prior. Furthermore, the easing Eurozone inflationary pressure, according to data released by Eurostat on Friday, alleviating pressure on the European Central Bank to continue raising interest rates. This, in turn, leads to the weakness in the Euro against its rivals.
On the Pound Sterling front, the Office for National Statistics (ONS) reported on Friday that monthly UK Retail Sales for July dipped -1.2%, below a -0.5% drop expected. Meanwhile, the annual figure fell -3.2%, against the estimation of -2.1%. The anticipation that the Bank of England (BoW) will maintain tightening remains high. However, the fear of an aggressive rate hike by the BoE might exert pressure on the Pound Sterling as investors worry that it might impact negatively the UK economy.
Looking ahead, the Eurozone Current Account and S&P Purchasing Managers' Index (PMI) and German Gross Domestic Product (GDP) Q2 will be released later this week. On the UK docket, the preliminary S&P PMI for August will be due on Wednesday. The data will be critical for determining a clear movement for the EUR/GBP cross.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD hold comfortably above 1.0750 as USD recovery loses steam
EUR/USD clings to small daily gains above 1.0750 in the early American session on Monday. In the absence of high-tier data releases, the US Dollar finds it difficult to gather recovery momentum and helps the pair hold its ground.
GBP/USD struggles to find direction, holds near 1.2550
GBP/USD stays under modest bearish pressure and trades near 1.2550 on Tuesday. The neutral risk mood, as reflected by the mixed action seen in US stocks, doesn't allow the pair to make a decisive move in either direction. The Bank of England will announce policy decisions on Thursday.
Gold rebounds to $2,320 as US yields edge lower
After falling to $2,310 in the early European session, Gold recovered to the $2,310 area in the second half of the day. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.5% and helps XAU/USD find support.
Ripple lawsuit develops with SEC reply under seal, XRP holders await public redacted versions
Ripple lawsuit’s latest development is SEC filing, under seal. The regulator has filed its reply brief and supporting exhibits and the documents will be made public on Wednesday, May 8.
The impact of economic indicators and global dynamics on the US Dollar
Recent labor market data suggest a cooling economy. The disappointing job creation and rising unemployment hint at a slackening demand for labor, which, coupled with subdued wage growth, could signal a slower economic trajectory.