EUR/GBP flat lines above mid-0.8300s, remains confined in a multi-day-old range

Source Fxstreet
  • EUR/GBP struggles for a firm near-term direction as traders keenly await the ECB on Thursday. 
  • The ECB is expected to lower interest rates again amid easing inflation and economic slowdown.
  • Bets for an aggressive BoE policy easing undermine the GBP and act as a headwind for the cross. 

The EUR/GBP cross extends its sideways consolidative price move through the first half of the European session on Monday and remains confined in a familiar range held over the past week or so. Spot prices currently trade around the 0.8365 region, nearly unchanged for the day as traders opt to wait on the sidelines ahead of the key central bank event risk later this week. 

The European Central Bank (ECB) is scheduled to announce its policy decision on Thursday and is expected to cut interest rates again for the third time this easing cycle amid mounting concerns over sluggish growth. Furthermore, inflation in the Eurozone fell below the ECB's 2% target for the first time since 2021 and backs the case for further policy easing. This, in turn, undermines the shared currency and turns out to be a key factor acting as a headwind for the EUR/GBP cross. 

Meanwhile, the Bank of England (BoE) Governor Andrew Bailey recently hinted that the central bank could cut interest rates more aggressively if there's further good news on inflation. The comments fueled speculation that the BoE might be headed towards speeding up its rate-cutting cycle and hold back traders from placing bullish bets around the British Pound (GBP). This, to a larger extent, offsets the negative factor and offers some support to the EUR/GBP cross.

The aforementioned mixed fundamental backdrop supports prospects for an extension of the subdued range price action in the absence of any relevant market-moving economic releases, either from the Eurozone or the UK. Hence, it will be prudent to wait for a sustained move in either direction before positioning for a firm near-term trajectory.

Economic Indicator

ECB Rate On Deposit Facility

One of the European Central Bank's three key interest rates, the rate on the deposit facility, is the rate at which banks earn interest when they deposit funds with the ECB. It is announced by the European Central Bank at each of its eight scheduled annual meetings.

Read more.

Next release: Thu Oct 17, 2024 12:15

Frequency: Irregular

Consensus: 3.25%

Previous: 3.5%

Source: European Central Bank

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Bulls Rout. Bitcoin Slumps Over 16% in a Week to Hit Bottom, Cryptocurrency Market Faces "Serial Liquidations"During the Asian trading session on June 5, Bitcoin extended its recent slump, falling more than 3.5% within 24 hours. It briefly broke below $62,000, hitting a low of $61,100, bringing i
Author  TradingKey
Yesterday 10: 01
During the Asian trading session on June 5, Bitcoin extended its recent slump, falling more than 3.5% within 24 hours. It briefly broke below $62,000, hitting a low of $61,100, bringing i
placeholder
Gold declines below $4,500 on stalled US-Iran ceasefire talks, US NFP data loomsGold price (XAU/USD) edges lower to near $4,470 during the early Asian session on Friday. The precious metal remains volatile amid ongoing geopolitical turmoil. Traders will closely monitor the developments surrounding the US-Iran peace deal and the US May employment report later on Friday. 
Author  FXStreet
Yesterday 01: 25
Gold price (XAU/USD) edges lower to near $4,470 during the early Asian session on Friday. The precious metal remains volatile amid ongoing geopolitical turmoil. Traders will closely monitor the developments surrounding the US-Iran peace deal and the US May employment report later on Friday. 
placeholder
Bitcoin Suffers Year’s Strongest Waterfall-Style Decline. Will It Next Drop to the $60,000 Mark?During the Asian trading session on June 4, Bitcoin continued its multi-day slump, briefly dropping below the $62,000 mark to $61,338. As of press time, Bitcoin was trading at $63,844, wi
Author  TradingKey
Jun 04, Thu
During the Asian trading session on June 4, Bitcoin continued its multi-day slump, briefly dropping below the $62,000 mark to $61,338. As of press time, Bitcoin was trading at $63,844, wi
placeholder
Bitcoin drops below $65K amid reinforced bear market signalsBitcoin (BTC) dipped further below $65,000 on Wednesday, with onchain data from Glassnode signaling a market firmly in a bear phase. The decline has pushed prices back into a key valuation range between the Realized Price and the True Market Mean.
Author  FXStreet
Jun 04, Thu
Bitcoin (BTC) dipped further below $65,000 on Wednesday, with onchain data from Glassnode signaling a market firmly in a bear phase. The decline has pushed prices back into a key valuation range between the Realized Price and the True Market Mean.
placeholder
Forex Today: US Dollar stays resilient ahead of key US dataHere is what you need to know on Wednesday, June 3:
Author  FXStreet
Jun 03, Wed
Here is what you need to know on Wednesday, June 3:
Related Instrument
goTop
quote