EUR to GBP trades on negative foot as investors digest a set of macroeconomic news from Eurozone and U.K. The correction that started the previous week after the rejection at 200-day moving average continues below the 0.8950.
European Monetary Union Unemployment Rate Below Expectations
European Monetary Union (EMU) Unemployment Rate came in at 7.9%, below the market consensus of 8% in July. European Monetary Union inflation turned negative at -0.2% below the expectations of 0.2% in August, increasing the chance of a new relief package from ECB to boost prices as CPI deviates further from its 2% CPI target. The yearly Core Consumer Price Index, which excludes fuel and food prices came in at 0.4% below the expectations of 0.9% in August; the July reading was at 1.2%.
Germany Manufacturing PMI Disappoints
The Germany Manufacturing PMI came in at 52.2 in August, below the analyst’s forecasts of 53. The European Monetary Union EMU) Manufacturing PMI came in at 51.7 in August matching the expectations. France Manufacturing PMI registered in at 49.8, beating the estimates of 49 in August.
Germany Unemployment Rate at 6.4%
Germany Unemployment Rate came in at 6.4% in line with markets forecasts, while the Unemployment Change came in at -9,000 below the estimates of 0.
German government revised its predictions from April that the economy would contract by 6.3% in 2020, and now expects a contraction of 5.8%. In 2021 expects the economy to grow by 4.4% below the previous forecast of 5.2%.
U.K. Manufacturing PMI Returns to February Levels
On the other side of the forex pair equation, the U.K. Manufacturing PMI came in at 55.2 in August the highest reading since February, but below the expectations of 55.3. The July reading was at 53.3.
EUR to GBP Technical Analysis
EUR to GBP is 0.29% lower at 0.8901 close to two-month lows as the correction accelerates below the 0.90 strong support as I have mentioned in my previous analysis EURGBP Faces Strong Support At 0.90 Mark.If we see today a break below 0.89, then the next target would be 0.8865 the low from June 9. More buying interest would emerge at 0.8775 the 200-day moving average.
On the other side, immediate resistance for EURGBP is at 0.8946 the daily high and the 100-day moving average. A move above might challenge 0.8965 the high from yesterday’s trading session. Next supply zone for EUR to GBP would be met at 0.90 the top from August 26.