EUR/GBP mildly declines despite steady UK retail sales data

EUR/GBP marginally fell to 0.8530, tallying a two-day losing streak.
The cross declined despite the release of steady UK retail sales data during the European session.
The data favors that the BoE will continue cutting rates.

Patricio Martín FXStreet

Friday's trading painted a slightly less vibrant picture for the EUR/GBP pair which slid to 0.8530 as investors are digesting mixed Retail Sales figures from the UK.

In July, UK retail sales showed signs of recovery, with total retail sales volume increasing by 0.5% month-on-month, slightly below expectations, but improving from a revised decline of 0.9% in June (previously reported as -1.2%). On a year-on-year basis, retail sales grew by 1.4%, matching expectations and up from a revised -0.3% in June (previously reported as -0.2%).

This increase in sales aligns with the improvement seen in the British Retail Consortium's same-store sales for July, signaling a strong start to the third quarter. Despite robust Q2 GDP figures, the June data indicated a slowdown as the quarter ended. Overall, the economic activity seems to be weak which might prompt the Bank of England to continue cutting.

EUR/GBP technical analysis

In the span of the last sessions, the EUR/GBP is primarily caught between the 200-day and 100-day Simple Moving Averages (SMAs) at 0.8550 and 0.8510 support and resistance levels respectively, and volume figures signify a gradually diminishing selling pressure. The fact that the bulls gave up the 200-day SMA on Thursday paints the outlook with bearishness.

At a technical level, the Relative Strength Index (RSI) of the pair is lingering around the mid-50s, indicating an equilibrium in market sentiment with neither the bulls nor the bears taking control but with a noticeable falling trend. The Moving Average Convergence Divergence (MACD) indicator is showing decreasing green bars, suggesting a possible downward momentum in future trading sessions.

EUR/GBP daily chart

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

AUD/USD keeps range near mid-0.7100s as USD bulls await US CPI

AUD/USD steadies near mid-0.7100s in the Asian session on Friday, stalling the previous day's sharp decline to an over one-week low. The August PPI report reaffirmed Fed rate-hike bets and boosted the US Dollar on Thursday, which weighed heavily on the pair. However, hawkish RBA expectations limited losses for the Aussie as USD bulls now await the release of the US consumer inflation figures before placing fresh bets.

USD/JPY holds lower ground toward 154.00; looks to US CPI

USD/JPY holds lower ground toward 154.00 in the Asian session on Friday after hot Japanese PPI data bolster a more hawkish BoJ repricing and provide fresh impetus to the Japanese Yen. However, the downside appears capped as the US Dollar preserves overnight gains ahead of the latest US consumer inflation data.

Gold: Gains remain capped by $4,400

Gold regains composure and trades with decent gains on Friday, managing to refocus attention on the $4,440 mark per ounce troy. Therefore, the precious metal reverses Thursday’s decline as the US Dollar alternates gains with losses at the end of the week.

Ripple Price Forecast: XRP extends decline as returning ETF inflows fail to lift outlook

Ripple (XRP) falls below $1.33 on Friday, marking the third consecutive day of declines. The token continues to track the broader cryptocurrency market downturn, with investors closely monitoring heightened macroeconomic uncertainty ahead of the United States (US) Consumer Price Index (CPI) release and next week’s Federal Reserve (Fed) monetary policy decision.

Weekly focus – The hawks set the tone

Risky assets came under pressure this week as energy prices kept creeping higher and the ECB surprised the markets with a hawkish tone. The price of Brent crude touched USD 110 per barrel on Thursday night, highest since mid-May, as news emerged that the Yemeni Houthis had reached control of key port cities and islands near the Bab el-Mandeb strait.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight

The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.