EUR/GBP pares losses after downbeat housing data from UK, trades around 0.8550

EUR/GBP trims intraday losses after weaker housing data from the United Kingdom (UK). However, the cross remains in the negative territory and trades around 0.8550 during the European trading hours on Tuesday.

In March, non-seasonally adjusted Nationwide Housing Prices witnessed a year-over-year increase of 1.6%, falling short of market expectations of a 2.4% rise and trailing the previous figure of 1.2%. The monthly index indicated a decrease of 0.2%, contrary to the anticipated increase of 0.3% and the previous increase of 0.7%. Traders are expected to evaluate the UK economic landscape by closely monitoring key indicators such as the S&P Global PMI and Halifax House Prices data.

BoE Governor Andrew Bailey remarked that market forecasts for three quarter-point rate reductions in 2024 are reasonable noting that the UK central bank isn't observing significant persistent inflationary pressures. These statements have fueled expectations for the BoE to implement interest rate cuts in June, consequently exerting downward pressure on the Pound Sterling (GBP).

Germany’s HCOB Manufacturing PMI rose to 41.9 in March, from the previous reading of 41.6. Furthermore, traders await Consumer Price Index (CPI) data from Germany scheduled to be released later in the day. Wednesday brings Harmonized Index of Consumer Prices (HICP) data from the Eurozone.

The Euro struggles after the dovish remarks from the European Central Bank’s (ECB) members, which in turn, undermined the EUR/GBP cross. ECB Governing Council member Yannis Stournaras proposed on Sunday that there could be a total of four interest rate cuts in 2024, amounting to a cumulative reduction of 100 basis points (bps) by the end of the year. Additionally, ECB policymaker Robert Holzmann indicated that interest rate cuts are probable, contingent upon the evolution of wage and price dynamics by June.