- EUR/GBP faces rejection near the 100-day SMA and snaps a seven-day winning streak.
- The better-than-expected BRC Like-For-Like Sales underpin the GBP and exert pressure.
- Bets for more aggressive policy easing by the BoE should cap the GBP and lend support.
The EUR/GBP cross continues with its struggle to make it through the 100-day Simple Moving Average (SMA) hurdle and meets with some supply on Tuesday. Spot prices remain depressed near the 0.8575 region through the first half of the European session and for now, seem to have snapped a seven-day winning streak.
The British Pound's (GBP) relative outperformance against its European counterpart could be attributed to the upbeat domestic data, which showed that Like-For-Like Retail Sales surged by the 3.2% YoY rate in March. This was better than the 1.8% rise expected and marked the strongest growth since August 2023, which, in turn, is seen as a key factor exerting some downward pressure on the EUR/GBP cross.
Apart from this, speculations that the European Central Bank (ECB) could cut interest rates soon amid a faster-than-anticipated fall in the Eurozone inflation undermine the shared currency and contribute to the offered tone surrounding the pair. That said, rising bets for at least four interest rate cuts this year by the Bank of England (BoE), starting in June, might cap the GBP and lend some support to the EUR/GBP cross.
This, in turn, warrants some caution before positioning for any further downfall in the absence of any relevant economic data due on Tuesday, either from the UK or the Eurozone. Meanwhile, the BoE Governor Andrew Bailey's appearance might influence the Sterling Pound and provide some impetus to the EUR/GBP cross. The focus, however, will remain on the monthly UK GDP print and factory data for February, due for release on Friday.
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