- EUR/GBP extends the sideline theme above 0.8600.
- Markets’ attention stay with the elections campaign.
- A hung government appears the most likely scenario in December.
The selling bias in the British Pound is helping EUR/GBP to extend the positive mood for the second session in a row near 0.8640.
EUR/GBP focused on UK politics, Largarde
The European cross is up for the second session in a row on Monday, on the back of renewed downside pressure on the quid and some steady trading in the single currency.
In fact, EUR managed to reverse an early drop after final October manufacturing PMIs in core Euroland surpassed a tad the preliminary readings and the Senctix index surprised to the upside for the current month.
On the other side of the Channel, attention remains on the run up to the December 12 elections, with polls keep leaning towards a hung government, as small parties like the Brexit Party and LibDems would prevent Tories or Labour to get majority.
In the UK docket, the Construction PMI came in a tad above estimates at 44.2 in October. Later in the day, ECB’s Chief C.Lagarde will speak in Berlin.
EUR/GBP key levels
The cross is gaining 0.17% at 0.8641 and faces the next hurdle at 0.8676 (high Oct.24) followed by 0.8810 (200-day SMA) and finally 0.8906 (50% Fibo of the May-August rally). On the downside, a breach of 0.8574 (monthly low Oct.17) would expose 0.8488 (monthly low May 6) and then 0.8474 (2019 low Mar.12).
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