EUR/GBP reaches fresh eight-week highs at 0.8970

EUR/GBP crawls above 08960 for the first time since late March.
The euro appreciates on hopes of an EU recovery fund.
The loses ground as BoE's Bailey hints to negative interest rates.

Guillermo Alcala FXStreet

EUR/GBP rebound from 0.8900 lows on Tuesday has extended on Wednesday’s US trading session, with the pair reaching prices beyond 0.8960 for the first time in nearly two months. The euro bounced up at 0.8920 earlier today, to reach 0.8970 highs so far.

The euro buoyed by the EU fund proposal

The euro is moderately positive on Wednesday, favoured by market hopes that the common fund proposal agreed by France and Germany will help coronavirus-hit members to shore up their economies. The €500 billion fund proposal, although smaller than expected, has helped to ease concerns about the differences among EU countries, boosting hopes about the possibility of a fiscal union.

On the other side, the pound sterling remains vulnerable following the comments by Bank of England Governor, Andrew Bailey, who let the doors open to the adoption of negative interest rates to tackle the effects of the coronavirus shutdown.

EUR/GBP: heading towardss 0.9060 – Commerzbank

According to Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, the EUR/GBP uptrend still has room to go, "We view the market as having recently based and our target is 0.9060. The base should remain valid while the cross continues to trade above the April low at 0.8671.”

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

EUR/USD stays well offered below 1.1800

The selling pressure on EUR/USD is picking up pace, with the pair slipping decisively below the key 1.1800 level and sliding to fresh two week lows as Wednesday’s session draws to a close. The move lower comes as the US Dollar finds renewed strength after the latest round of US data and the release of the FOMC Minutes. Next of note on the docket will be the US weekly Initial Jobless Claims.

GBP/USD reaches multi-day lows near 1.3500

GBP/USD reverses its initial upside momentum and is now adding to previous declines, approaching the 1.3500 region on Wednesday. Cable’s downtick comes on the back of decent gains in the Greenback and easing UK inflation figures, which seem to have reinforced the case for a BoE rate cut in March.

Gold battle to regain $5,000 continues

Gold is back on the front foot on Wednesday, shaking off part of the early week softness and challenging two-day highs near the $5,000 mark per troy ounce. The move comes ahead of the FOMC Minutes and is unfolding despite an intense rebound in the US Dollar.

Australia unemployment rate set to edge up within overall strong labor market

The Australian monthly employment report is scheduled for release on Thursday at 00:30 GMT, and market participants anticipate a modest increase in jobs in January. The Australian Bureau of Statistics is expected to announce that the country added 20K new jobs in the month, while the Unemployment Rate is forecast at 4.2%, up from the 4.1% posted in December.

Mixed UK inflation data no gamechanger for the Bank of England

Food inflation plunged in January, but service sector price pressure is proving stickier. We continue to expect Bank of England rate cuts in March and June. The latest UK inflation read is a mixed bag for the Bank of England, but we doubt it drastically changes the odds of a March rate cut.

Sui extends sideways action ahead of Grayscale’s GSUI ETF launch

Sui is extending its downtrend for the second consecutive day, trading at 0.95 at the time of writing on Wednesday. The Layer-1 token is down over 16% in February and approximately 34% from the start of the year, aligning with the overall bearish sentiment across the crypto market.