- The cross retakes the 0.8500 handle and above.
- UK’s GDP will be in the limelight later in the week.
- Risk-off sentiment weighs on EUR and GBP.
Renewed threats from President Trump to impose further tariffs on Chinese goods are hurting the sentiment in the risk-associated space and helping EUR/GBP to regain some traction above 0.8500 the figure.
EUR/GBP bottomed out below 0.8500
After bottoming out in the 0.8490/85 band during early trade, the European cross managed to regain some poise and has regained the 0.8500 handle and above on the re-emergence of the risk aversion in the global markets.
In fact, fresh US-China trade concerns have reignited in response to threats from President trump to increase tariffs on Chinese products and speculations that China could leave the negotiation table.
Regarding Brexit, talks between May’s government and Labour leader J.Corbyn are likely to continue in the next weeks, although against the backdrop of increasing anf firm opposition from Brexiteers MPs.
In the UK data space, advanced Q1 GDP figures are coming up on Friday along with Industrial and Manufacturing Production figures. In addition house prices tracked by the Halifax index are expected tomorrow.
Earlier today, the Sentix index and Retail Sales in Euroland surprised markets to the upside.
EUR/GBP key levels
The cross is gaining 0.49% at 0.8540 and a break above 0.8599 (55-day SMA) would expose 0.8681 (high Apr.23) and finally 0.8722 (high Mar.21). On the other hand, the next support lines up at 0.8488 (low May 6) followed by 0.8483 (low Mar 27) and then 0.8471 (2019 low Mar.13).
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