EUR/GBP loses ground after German PPI, trades lower around 0.8750


  • EUR/GBP pulls back from the six-month highs.
  • Euro receives downward pressure after the German PPI data.
  • BoE may consider rate cuts following weaker UK Retail Sales.

EUR/GBP retreats from the six-month highs, trading lower around 0.8750 during the European session on Monday. The Euro seems to lose ground after the German economic data released on Monday. The Producer Price Index (MoM) reported a decline of 0.1% in October as expected. The annual rate declined by 11.0% lower than the previous contraction of 14.7%.

However, the Euro could maintain its support from hawkish comments made by European Central Bank (ECB) officials on Friday, resisting expectations for early rate cut speculations. Joachim Nagel, the President of Bundesbank, cautioned against initiating interest rate cuts too early. Additionally, ECB policymaker Robert Holzmann argued that the second quarter would be premature for a rate cut.

Market expectations point towards the Bank of England (BoE) considering a reduction in interest rates from their 15-year peak due to looming recession risks. These expectations gained strength following weaker United Kingdom (UK) Retail Sales figures, aligning with a pessimistic outlook for the British economy. This scenario could lend support to the Pound Sterling (GBP).

On Friday, UK Retail Sales (MoM) reduced by 0.3% against the market expectation of a 0.3% rise in October. The yearly rate declined by 2.7% against the expected decline of 1.5%. Additionally, Core Retail Sales (MoM) declined by 0.1% compared to the expected rise of 0.4%.

Investors will take more insights from the Bank of England (BoE) Monetary Policy Report Hearings scheduled for Wednesday and the European Central Bank (ECB) Monetary Policy Meeting Accounts on Thursday. These events are expected to provide valuable cues on the interest rate trajectory from both countries.

EUR/GBP: additional levels to watch

Overview
Today last price 0.8749
Today Daily Change -0.0005
Today Daily Change % -0.06
Today daily open 0.8754
 
Trends
Daily SMA20 0.8714
Daily SMA50 0.8676
Daily SMA100 0.8628
Daily SMA200 0.8685
 
Levels
Previous Daily High 0.8763
Previous Daily Low 0.8736
Previous Weekly High 0.8766
Previous Weekly Low 0.8689
Previous Monthly High 0.8754
Previous Monthly Low 0.8616
Daily Fibonacci 38.2% 0.8753
Daily Fibonacci 61.8% 0.8746
Daily Pivot Point S1 0.8739
Daily Pivot Point S2 0.8723
Daily Pivot Point S3 0.8711
Daily Pivot Point R1 0.8767
Daily Pivot Point R2 0.8779
Daily Pivot Point R3 0.8794

 

 

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