EUR/GBP Consolidation Continues Below 0.8600 Amid Firm BoE Rate Cut Speculations
EUR/GBP remains range-bound below the key level of 0.8600 as investors reconsider their expectations regarding the Bank of England’s (BoE) potential rate cuts. BoE’s Mann cautioned that the market might be anticipating excessive rate cuts, while ECB’s Muller hinted at the possibility of rate reductions.
The EUR/GBP pair is currently consolidating near 0.8580 after encountering resistance at the critical level of 0.8600. This consolidation comes after the release of softer-than-expected inflation data for February in the United Kingdom, leading to a reassessment of market forecasts regarding the BoE’s interest rate adjustments.
Prior to the latest inflation data, investors were eyeing potential rate cuts from the BoE starting in August. However, the BoE’s recent dovish stance on interest rates, coupled with the slight downward adjustment of inflation, has shifted expectations towards rate cuts, possibly as early as June. The central bank has indicated that the market’s projection of two or three rate cuts this year is not unreasonable, citing positive movements in inflation.
BoE Governor Andrew Bailey’s remarks in a recent interview with the Financial Times further fueled speculation, suggesting that rate cuts are on the table for this year. Additionally, BoE policymaker Catherine Mann, previously considered a hawkish member, surprised the market by voting for maintaining the current interest rate level.
During Tuesday’s European session, Mann explained her change in voting stance, attributing it to factors such as consumer-driven pricing discipline, shifts in labor market dynamics, and changes in financial market curves. However, she cautioned against excessive market anticipation of rate cuts.
Meanwhile, in the Eurozone, investors are hopeful that the European Central Bank (ECB) will also consider rate reductions soon. ECB policymaker Madis Muller hinted at the possibility of rate cuts, citing easing wage growth as a contributing factor, thus aligning with market expectations for potential rate adjustments at the June meeting.
EUR/GBP
| OVERVIEW | |
|---|---|
| Today last price | 0.8575 |
| Today Daily Change | -0.0001 |
| Today Daily Change % | -0.01 |
| Today daily open | 0.8576 |
| TRENDS | |
|---|---|
| Daily SMA20 | 0.8551 |
| Daily SMA50 | 0.8549 |
| Daily SMA100 | 0.86 |
| Daily SMA200 | 0.8608 |
| LEVELS | |
|---|---|
| Previous Daily High | 0.8593 |
| Previous Daily Low | 0.8565 |
| Previous Weekly High | 0.8602 |
| Previous Weekly Low | 0.853 |
| Previous Monthly High | 0.8578 |
| Previous Monthly Low | 0.8498 |
| Daily Fibonacci 38.2% | 0.8576 |
| Daily Fibonacci 61.8% | 0.8582 |
| Daily Pivot Point S1 | 0.8563 |
| Daily Pivot Point S2 | 0.8551 |
| Daily Pivot Point S3 | 0.8536 |
| Daily Pivot Point R1 | 0.8591 |
| Daily Pivot Point R2 | 0.8606 |
| Daily Pivot Point R3 | 0.8618 |
