The EUR/GBP currently trades at 0.8536, reflecting minor losses on Friday.
The pair will tally a seven-week losing streak.
Focus is set on next week’s British economic data including inflation and labor market reports.
A more hawkish stance of the BoE in relation to the ECB gives the Pound traction.
On Friday’s session, the EUR/GBP traded at 0.8536, posting mild losses amid contrasting monetary policy expectations from the European Central Bank (ECB) and the Bank of England (BoE) ahead of key economic figures of the British economy to be released next week. Meanwhile, the technical scenario remains bearish on the weekly and daily chart with bears gaining ground and tallying a seven-week selling spree.
Adding to that, despite the ECB pushing back against market easing expectations, a 55% chance of an interest rate cut in April is still predicted. On the other hand, markets are expecting a potential uptick in inflation in the UK, with the Consumer Price Index (CPI) expected to have risen by 4.1% YoY in January, prompting a greater likelihood of the BoE delaying cuts. The inflation report is due on Wednesday and on Tuesday, the UK will release labor market figures which will also shape the expectations of the next decisions. As for now, markets are seeing 100 bps of easing by the British bank, and 125 bps of easing from its European peer, and as long as investors bet on more easing by the ECB, the pair could continue falling.
EUR/GBP technical analysis
From a technical viewpoint, the daily and weekly chart’s negative direction of the Relative Strength Index (RSI) and the cross dwelling under its 20, 100, and 200-day Simple Moving Averages (SMAs) insinuate bearish dominance. This indicates that bearish momentum persists and selling pressure is primarily in control. The current seven-week losing streak of the pair also reinforces the negative outlook leaving the cross exposed for further downside.
EUR/GBP weekly chart
-638430929912432703.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : FXStreet – https://www.fxstreet.com/news/eur-gbp-bears-return-amid-ecb-and-boes-contrasting-bets-eyes-on-british-data-202402091629