EUR/GBP is off lows but has nonetheless slipped underneath the 0.8600 level. Soft Industrial Production numbers out of Germany and Spain seemed to weigh the pair earlier on in the session. EUR/GBP is back below 0.8600; in recent trade EUR/GBP has bounced back into the 0.8580s, having briefly been under the 0.8570 mark earlier in the session. However, the pair is still trading with losses of about 0.3% or just over 20 pips on the day and looks to have maintained it recent bearish bias that has seen the drop from late-February highs of around 0.8730 to current levels back underneath the 0.8600 level in just a matter of days. To the downside, the most notable area of resistance is the February low at 0.8540; some traders may look to short EUR/GBP as it moves back up towards the 0.8600 level, given this also coincides with resistance in the form of last week’s low. Driving the day The most interesting news of the day so far for euro currency pairings was recently released weekly data on the ECB’s various asset purchase programmes. The ECB’s net Pandemic Emergency Purchase Programme (PEPP) purchases slowed for a second week running to just under EUR 12B, despite recent rhetoric about how the bank is “monitoring” long-term bond yields more closely, and even from some ECB members who have called for the bank to accelerate the pace of asset purchases. The excuse for slowing purchases down (when markets might have anticipated that they would accelerate them) given by an ECB spokesperson came down to a combination of seasonal effects and higher than usual redemptions. Markets seem to have bought these excuses for now, but reporters are likely to press ECB President Christine Lagarde on this topic during the press conference at this week’s ECB rate decision. Also of note for the euro on the first trading day of the week is the latest industrial production numbers out of Germany and Spain; German Industrial Production in the month of January was weaker than expected, dropping 2.5% on the month versus expectations for a modest 0.2% rate of growth. Despite Monday’s downbeat German numbers, ING optimistically notes that with “production expectations in the manufacturing sector surging and order books still improving, the prospects of industrial production remain positive”. Meanwhile, Spanish Industrial Production dropped by a similar margin, down 2.2% on the month, worse than expectations for a 0.7% MoM drop. EUR weakness as European traders arrived at their desks on Monday morning coincided and likely was exacerbated by these weak data points. A stronger than anticipated Eurozone Sentix survey, whose headline index rose to 5.0 from -0.2 versus expectations of a more modest rise to 1.9, was unable to help the euro much at the time. Turning to GBP, there doesn’t seem to be any particular news of theme driving the currency on Monday, although familiar themes might be helping it to outperform its euro counterpart; UK Covid-19 infection and death rates continue to head lower (whilst they, unfortunately, rise in the EU) and UK health officials remain confident in the UK’s timetable to reopening despite new Covid-19 variants. YouGov reported that UK consumer confidence is at its highest level since the start of the pandemic, with this level set only to rise in the coming weeks as the economy reopens. Elsewhere, comments from BoE Governor Bailey this morning were in fitting with his recent rhetoric; he reiterated that just because the bank has added negative interest rates to its policy toolkit does not mean that the bank is definitely going to use them. Moreover, the governor said that he expects the bank’s next unemployment forecast to be a little more optimistic, while the next inflation forecast will be moved a little higher in the short-term. FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next Gold Price Analysis: XAU/USD hits nine months lows under $1680 FX Street 1 year EUR/GBP is off lows but has nonetheless slipped underneath the 0.8600 level. Soft Industrial Production numbers out of Germany and Spain seemed to weigh the pair earlier on in the session. EUR/GBP is back below 0.8600; in recent trade EUR/GBP has bounced back into the 0.8580s, having briefly been under the 0.8570 mark earlier in the session. 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