EUR/GBP pushes higher beyond 0.8700 on GBP-selling

  • Extra downside in the Sterling leads the up move in the cross.
  • EU Tusk will meet UK May in Egypt although a deal is ruled out.
  • EMU CPI matched estimates. German IFO came in below consensus.

The selling bias around the British Pound is now picking up pace and is sponsoring the up move in EUR/GBP to tops beyond 0.8700 the figure.

EUR/GBP focused on Brexit and Brexit alone

The renewed uncertainty around Brexit have relegated the recent optimism on a potential deal between the UK and the EU in the next weeks, forcing the Sterling to shed part of its gains and thus lending some wings to the European cross.

Always around Brexit, EU D.Tusk is expected to meet PM T.May in Sharm El-Sheikh at the EU-Arab Summit over the weekend, although EU officials have already ruled out any chances to seal an agreement.

In the data space, German IFO Survey extended the downtrend in February, coming in below expectations in all of its components and at the same time adding to the sour sentiment in the euro region. Further data saw inflation figures in the broader euro area matching the preliminary prints for the month of January.

Later in the day, ECB’s Mario Draghi is due to speak.

What to look for around GBP

The Sterling is expected to remain under increasing pressure as the clock continues to tick and there is no progress on the horizon (or even any hint of it) in the UK-EU divorce negotiations. So far, consensus among market participants seems to lean to an extension of Article 50 or a deal at the very last minute as it appears to be no support for a ‘no deal’ scenario. In the meantime, the Irish backstop stays the critical issue to be resolved and the main obstacle for further progress in negotiations. This, in combination with poor UK fundamentals should be enough to keep occasional rallies in GBP somehow capped.

EUR/GBP key levels

The cross is gaining 0.26% at 0.8710 and a breakout of 0.8741 (21-day SMA) would aim for 0.8840 (high Feb.14) and finally 0.8858 (200-day SMA). On the flip side, the next support aligns at 0.8666 (low Feb.21) seconded by 0.8655 (low Nov.13 2018) and then 0.8616 (2019 low Jan.25).

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.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD supported at 1.1200 ahead of Eurozone data

EUR/USD managed to retain the 1.12 handle amid broad-based US dollar bullish consolidation, as markets seem to have scaled back expectations of Fed rate cuts. Focus on Eurozone final CPI data.


GBP/USD struggles above 1.2400 post-UK CPI

The latest recovery in the GBP/USD pair seems to lack follow-through, as the price reverts to the 1.24 handle amid in-line with estimates UK CPI figures and looming Hard Brexit concerns. 


USD/JPY consolidates in a range, comfortably above 108.00 handle

Reviving safe-haven demand underpins JPY and exerts some pressure. Renewed weakness in the US bond yields further weighed on the USD. The downside remains limited amid tempered Fed rate cut expectations.


Gold clings to 21-DMA amid less active markets

Gold carries the 3-week old lower high formation forward as it clings to 21-day moving average (DMA) during Wednesday’s less active market hours ahead of the European session. Lack of major data/news during the Asian session limits market moves.

Gold News

Forex Today: US dollar corrects, US-Japan eye a trade deal, and Bitcoin bounces

US dollar reverses a part of Tuesday’s US retail sales data-led rally. US-Japan are working towards a trade deal by September. Bitcoin recovers, but remains below the 10k mark.

Read more