EUR/GBP moves sideways near 0.8590 ahead of UK employment data

EUR/GBP consolidates ahead of the employment data from the United Kingdom (UK) and interest rate decisions from the European Central Bank (ECB). Spot price hovers around 0.8590 during the Asian session on Tuesday.

The UK is set to release employment data later in the day including Claimant Count Change for August. While Employment Change for July is expected to print a decline of 185K compared to the previous decline of 66K. The ILO Unemployment Rate (3M) seems to rise by 4.3% in July against the previous rate of 4.2%.

During the weekend, the UK's Chancellor of the Exchequer, Jeremy Hunt, stated that the Bank of England (BoE) is facing a higher level of sustained inflation than they had originally forecasted.

The elevated wage growth is contributing to the resilience of inflation. Market participants will closely monitor the upcoming data, as any positive figures could complicate the Bank of England's (BoE) stance, making it challenging for them to maintain a clear-cut position, especially in light of concerns about a potential recession.

On the other hand, the European Central Bank (ECB) is scheduled to announce its latest interest rate decision on Thursday. Despite recent hawkish statements from ECB officials, market participants are becoming more convinced that the rate hike cycle in the Eurozone has reached its peak.

The prevailing market forecasts generally expect the ECB to keep interest rates unchanged at the September meeting. However, any unexpected and surprising moves or statements from the ECB have the potential to disrupt the markets and create uncertainty about the direction of the cross-pair.