- EUR/GBP snaps the losing streak despite the downbeat economic data from the UK.
- Euro faces a challenge as the ECB is expected to keep interest rates unchanged in the upcoming meeting.
- ECB’s Yannis stated that there is little benefit in accelerating the conclusion of the PEPP.
EUR/GBP halts the losing streak that began on October 3, trading in the green zone around 0.8630 during the European session on Thursday. The pair receives upward support despite the downbeat economic data from the United Kingdom (UK).
Industrial Production (MoM) declined 0.7% in August, exceeding the expectation of 0.2% decline. The previous reading was negative by 1.1%. Manufacturing Production month-over-month fell by 0.8% compared to the market consensus of a 0.4% decline and a 1.2% decline in July.
Bank of England (BoE) policymakers are bracing for challenges as a dip in demand and a general decrease in output loom on the horizon ahead of the November interest rate decision.
Katherine Mann of the BoE remains a staunch proponent of tightening policies to swiftly curb inflation and bring it in line with the 2% target. Conversely, Swati Dhingra, another figure at the central bank, favors the notion of a rate cut should the growth rate unexpectedly dip below expectations.
On the flip side, speculations abound that the EUR/GBP pair might encounter additional hurdles, given the prevailing notion that the European Central Bank (ECB) is currently sidelining the possibility of further rate hikes.
Yannis Stournaras, a European Central Bank (ECB) policymaker, emphasized the importance of not prematurely halting the bond-buying initiative within the European Central Bank's emergency program.
ECB Yannis highlighted that there is little benefit in accelerating the conclusion of the Pandemic Emergency Purchase Programme (PEPP), especially given the fresh uncertainties arising from events in Israel and Palestine. The policymaker stressed the need to maintain flexibility and be prepared to act if deemed necessary.
The EUR/GBP pair is experiencing downward pressure as Francois Villeroy de Galhau, a member of the ECB Governing Council and President of the Bank of France, views monetary policy as adequately restrictive.
Villeroy cautioned against additional policy tightening, emphasizing that it is not the appropriate course of action, particularly in the current context of heightened Middle East tensions contributing to a positive outlook for oil prices.
Market participants will likely watch the ECB Monetary Policy Meeting Accounts on Thursday, seeking an overview of economic and monetary developments. Additionally, ECB's President Christine Lagarde's speech will be eyed on Friday.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stabilizes near 1.0500, looks to post weekly losses
EUR/USD extended its daily decline toward 1.0500 in the second half of the American session, pressured by the souring market mood. Despite the bullish action seen earlier in the week, the pair remains on track to register weekly losses.
GBP/USD falls below 1.2150 as USD rebounds
Following an earlier recovery attempt, GBP/USD turned south and declined below 1.2100 in the second half of the day on Friday. The negative shift seen in risk mood amid rising geopolitical tensions helps the US Dollar outperform its rivals and hurts the pair.
Gold advances to fresh multi-week highs above $1,920
Gold extended its daily rally and climbed above $1,920 for the first time in over two weeks on Friday. Escalating geopolitical tensions ahead of the weekend weigh on T-bond yields and provide a boost to XAU/USD, which remains on track to gain nearly 5% this week.
Bitcoin could be an alternative to US-listed companies but not in the short term
Bitcoin has dipped below $27,000, adding to the subdued cryptocurrency market sentiment. While short-term price concerns persist, analysts predict a rebound based on historical figures.
Nvidia Stock Forecast: NVDA slips as Biden administration attempts to close AI chip loophole
Nvida's stock price opened marginally lower on Friday after Reuters reported that the Biden administration is attempting to close a loophole that allowed Chinese companies access to state-of-the-art computer chips used for AI.