- EUR/GBP alternates gains with losses in the 0.9040 region.
- EU-UK Brexit negotiations remain well in place ahead of the EU Summit.
- UK’s labour market reported mixed results earlier on Tuesday.
EUR/GBP navigates in the mid-0.90s and always looking to headlines from both the UK and the EU regarding the Brexit negotiations.
EUR/GBP focused on EU Summit
EUR/GBP appears to have recovered the smile following four consecutive daily pullbacks on turnaround Tuesday. In fact, the cross rebounds from the 0.9020/15 band to the current 0.9050 zone, up smalls for the day so far.
In the meantime, price action around the quid continues to track headlines from UK and EU negotiators under the ongoing Brexit talks. Indeed, while UK’s Raab sounded more optimistic in his comments on Tuesday, EU’s Barnier reiterated an important gap still remains in key issues like fisheries, level playing field and governance.
It is worth recalling that the crucial event for these negotiations will be the EU Summit on October 15-16.
Data wise on Tuesday, the Economic Sentiment measured by the ZEW survey in both Germany and the euro area receded more than expected in October, adding to the idea that the recovery in the region could be losing some traction. Earlier in the session, the UK’s labour market report showed mixed results after the Claimant Count Change rose by 28K in September (vs. forecasts for nearly +80K raise) but the unemployment rate ticked higher to 4.5% (from 4.1%) in August.
EUR/GBP key levels
The cross is up 0.12% at 0.9050 and faces the next up barrier at 0.9161 (monthly hig Oct.7) followed by 0.9220 (high Sep.22) and then 0.9291 (monthly high Sep.11). On the other hand, a breach of 0.9019 (monthly high Oct.13) would expose 0.8865 (monthly low Sep.3) and finally 0.8670 (monthly low Apr.30).
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