The EUR to GBP (EURGBP) pair is down by about 0.25% as traders react to the upbeat inflation data from the United Kingdom. The pair is trading at 0.9058, which is slightly below yesterday’s high of 0.9100.
UK inflation rises
Consumer prices rose slightly in June as the UK continued to reopen after the recent lockdowns. Data from the Office of National Statistics (ONS) showed that the headline consumer prices rose by 0.6% in June after rising by 0.5% in May. On a MoM basis, the prices rose to 0.1%, up from the previous 0.0%.
Meanwhile, the so-called core CPI rose to 1.4% in June from the previous 1.2%. Analysts polled by Reuters were expecting the index to rise to 1.2%. The rise in inflation was mostly because of higher clothing and recreational sectors. The two probably rose because they were among the worst-affected in the previous months because they were non-essential services.
Still, inflation is below the BOE’s target of 2%. Just yesterday, data from the country showed that the economy expanded by 1.8% in May but the economy was still 24.5% smaller than it was in February.
The EURGBP pair will next react to inflation numbers from Italy ahead of the ECB interest rate decision set for tomorrow.
EURGBP technical outlook
The EURGBP pair is trading at 0.9058, which is a few pips below 0.9100, the highest point yesterday. On the daily chart, the price is above the 50-day and 100-day exponential moving averages. It is also slightly above the 61.8% Fibonacci retracement level. Further, the EUR to GBP pair is above the ascending trend line shown in black. Therefore, the pair is likely to continue rising as bulls target the next resistance at 0.9175, which is the highest level on June 29.
On the flip side, a move below 0.9035 will invalidate this trend. This price is along the 61.8% Fibonacci retracement and the ascending trend line.
Don’t miss a beat! Follow us on Telegram and Twitter.
EUR to GBP forecast
More content
- Download our latest quarterly market outlook for our longer-term trade ideas.
- Follow Crispus on Twitter.
- Do you enjoy reading our updates? Become a member today and access all restricted content. It is free to join.