EURGBP update after the PMIs

The release of the flash PMI indices for January from the European Union and the United Kingdom were the main data releases for the European morning session today. Data from France and Germany proved mixed. The situation in the French data is diametrically opposite to that of the German figures – the manufacturing index beat expectations while the services gauge came in below estimates. While economists noted that pricing pressures continue to mount in Germany’s services sector, they also pointed out that a recession in the eurozone’s largest economy remains highly unlikely. Turning to UK data, the reading also turned out to be mixed, with the manufacturing sector beating estimates and services coming in below expectations. Nonetheless, the GBP dipped on the release as new data after retail sales and labor market figures showed the economic situation in the UK is deteriorating.

France

  • Manufacturing: 50.8 vs. 49.7 expected (49.2 previously)

  • Services: 49.2 vs. 49.9 expected (49.5 previously)

Germany

  • Manufacturing: 47.0 vs. 47.8 expected: (47.1 previously)

  • Services: 50.4 vs. 49.6 expected (49.2 previously)

United Kingdom

  • Manufacturing: 46.7.0 vs. 45.6 expected: (45.3 previously)

  • Services: 48.0 vs. 49.9 expected (49.9 previously)

The EUR and GBP weakened after mixed PMI releases, but the GBP’s decline exceeded that of the EUR. As a result, the EURGBP currency pair may trade higher today. The pair is trading up 0.6% on the day and extends a rally launched after an unsuccessful attempt to break below the support zone in the 0.8725 area, marked by a 50 session moving average and previous price reactions. If the bulls remain in check, the closest resistance area to watch is above the 0.8850 mark.

EURGBP D1. Source: xStation5

“This material is marketing communication within the meaning of Art. 24(3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/ 92/EC and Directive 2011/61/EU (MiFID II) Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No. 596/ 2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (Market Abuse Regulation) and repealing Directive 2003/6 / EC of the European Parliament and of the Council and Directives 2003/124 / EC, 2003/125 / EC and 2004/72 / EC of the Commission and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to standards regulatory techniques relating to the technical modalities of objective presentation of r investment recommendations or other information recommending or suggesting an investment strategy and for the disclosure of special interests or indications of conflicts of interest or any other advice, including in the field of investment advice, to meaning of the law of 29 July 2005 on trading in financial instruments. (i.e. Journal of Laws 2019, item 875, as amended). All the information, analyzes and training provided are provided for information purposes only and should not be interpreted as advice, a recommendation, an investment solicitation or an invitation to buy or sell financial products. XTB cannot be held responsible for the use made of it and the resulting consequences, the end investor remaining the sole decision maker as to the position taken on his XTB trading account. Any use of the information mentioned, and in this respect any decision taken in relation to a possible purchase or sale of CFDs, is the sole responsibility of the end investor. It is strictly forbidden to reproduce or distribute all or part of this information for commercial or private purposes. Past performance is not necessarily indicative of future results, and anyone acting upon this information does so entirely at their own risk. CFDs are complex instruments and come with a high risk of losing capital rapidly due to leverage. 82% of retail investor accounts lose money when trading CFDs with this provider. You need to make sure you understand how CFDs work and can afford to take the likely risk of losing your money. With the Limited Risk Account, the risk of loss is limited to the capital invested.

Leave a Comment