EURGBP fails to capture 0.8700 ahead of Eurozone Retail Sales
- EURGBP has sensed selling pressure while attempting a break above 0.8700.
- The ECB is expected to paddle up its policy tightening measures to bring the inflation rate to 2%.
- Eurozone Retail Sales data is seen at -1.3% vs. the prior release of -2.0%.
The EURGBP pair is hovering around its intraday low after struggling to cross the immediate hurdle of 0.8700 in the Tokyo session. The cross witnessed a vertical fall on Monday after failing to hold itself above the ultimate resistance of 0.8780 as investors turned cautious ahead of Eurozone Retail Sales data.
Meanwhile, European Central Bank (ECB) President Christine Lagarde is continuously reiterating her view that the rate hike cycle must ensure that inflation should return to a projected 2% over the medium term. The inflation rate in the trading bloc has reached to double-digit figure and containment of the same won’t be a cakewalk. Also, Russia-Ukraine tensions and eventually rising energy prices have a headache for the ECB President.
In addition to that, ECB member Martins Kazaks has supported Lagarde’s viewpoint on inflation and has said ''there is no pivot, we still say that inflation is a problem, and we will keep raising rates.''
On the economic data front, the Eurozone Retail Sales data will be of utmost importance. The economic data may remain in a negative trajectory at -1.3% but will improve against prior figure of -2.0%. Despite, soaring price pressures, lower retail sales indicate an extreme weakness in retail demand.
Meanwhile, Pound investors are preparing for the Gross Domestic Product (GDP) data, which will release later this week. The GDP data on an annual basis is seen lower at 2.1% vs. the prior release of 4.4%. And, the quarterly regime is expected to display negative growth by 0.5% against an expansion of 0.2%.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
