EUR/GBP drifted back towards 0.8550 on Tuesday, giving up earlier Euro strength even after mixed macro signals. Germany’s ZEW Economic Sentiment index rose to 34.2 in August, topping the 30.0 forecast and improving on July’s 26.3, while the Eurozone measure also advanced more than expected. The release drew little reaction in EUR/USD and failed to keep the cross supported, despite an earlier wobble in Sterling after the UK labour data.
UK Labour Data And Economic Focus
The UK report for the three months to June showed the ILO Unemployment Rate unchanged at 4.9%, compared with a 4.8% forecast, and employment growth slowed. Focus shifts to Wednesday’s UK CPI for July, where consensus looks for 2.9% year-on-year after 2.6% previously. In technical terms, the pair traded at 0.8551 on a four-hour view, sitting above the 20-period SMA at 0.8549 but below the 100-period SMA at 0.8558, with horizontal levels at 0.8553 and 0.8559 overhead; RSI (14) was around 51, with support at 0.8551.
