EUR/GBP spikes above 0.89 on latest Brexit headlines
|- UK Treasury Minister says there could be another Brexit referendum.
- Inflation in the UK surprises to the upside in August.
- Comin up: ECB's Draghi is scheduled to deliver a speech at 13 GMT.
The EUR/GBP pair gained nearly 60 pips in a matter of minutes as the GBP came under heavy selling pressure following the latest Brexit headlines. After spiking up to 5-day high at 0.8917, the pair retreated a little and was last seen trading at 0.8882, where it was up 0.12% on the day.
In an interview with Sky News today, the UK Treasury Minister, Mel Stride, said that there could be another Brexit referendum if British Prime Minister Theresa May's Chequers proposals were to get rejected in the Parliament. Meanwhile, former Brexit Secretary, David Davis, stated that he wouldn’t vote for PM May’s Brexit deal in the Parliament.
Earlier in the day, the pound sterling gathered strength against its rivals on the back of the upbeat inflation report. The data released by the UK's Office for National Statistics showed that the annual CPI in August rose 2.7% from 2.5% in July to surpass the market expectation of 2.4%. The core version of the index, which excludes volatile food and energy prices, grew 2.1% in the same period vs the analysts' estimate of 1.8%. In line with the CPI figures, the Retail Price Index advanced to 3.5% from 3.2%.
Later in the session, investors will be following ECB President Mario Draghi's comments as he delivers a scheduled speech at 13 GMT.
Technical levels to consider
The pair could face the first support at 0.8875 (100-DMA) ahead of 0.8825 (Jul. 13 low) and 0.8750 (Jun. 22 high). On the upside, resistances align at 0.8945 (50-DMA), 0.9000 (psychological level) and 0.9050 (Sep. 5 high).
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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.