EUR/GBP extends losses to 0.8300 after GDP data and retail sales of the United Kingdom

• The EUR/GBP remains under pressure as the sterling pound gains strength after the publication of key economic data from the United Kingdom on Friday.
• The GDP of the United Kingdom in the fourth quarter grew 0.1% compared to the previous quarter, complying with market expectations.
• The GFK consumer confidence survey in Germany for April registered -24.5, below -23.0 anticipated.

The EUR/GBP continues its career down for the second consecutive day, quoting about 0.8330 in the first European hours. The currency pair faces pressure as the sterling pound (GBP) is strengthened after the publication of the Gross Domestic Product (GDP) of the United Kingdom and the retail sales data of the fourth quarter on Friday.

The GDP of the United Kingdom grew by 0.1% compared to the previous quarter in the fourth quarter, in line with expectations. In annual terms, GDP expanded 1.5%, exceeding the projected increase of 1.4%. In addition, retail sales of the United Kingdom increased an intermencing 1.0% in February, challenging the forecasts of a 0.3% drop, although slowing down from the increased downward increase of 1.4% in January. In year -on comparison, retail sales rose 2.2%, exceeding expectations of a 0.5%increase and accelerating from a 0.6%revised increase.

Underlying retail sales, excluding car fuel sales, also increased by 1% intermensual, exceeding the forecast of a fall of -0.5% but below the previous growth of 1.6%. In annual terms, underlying retail sales advanced 2.2%, compared to 0.8% reviewed, both figures exceeding market projections.

On Thursday, the Treasury Chancellor of the United Kingdom, Rachel Reeves, declared in an interview with Bloomberg TV that the United Kingdom would not impose retaliation tariffs, emphasizing the need to avoid the escalation of commercial tensions. He expressed a preference for reducing tariffs, arguing that commercial friction could hinder economic growth.

Meanwhile, the EUR/GBP cross faces a new descent as the euro (EUR) weakens in the middle of the commercial tensions escalation between the US and the Eurozone. Concerns about a possible commercial war have intensified as the European Union (EU) prepares for retaliation tariffs in response to 25% tariffs on cars imposed by former US president Donald Trump, who will enter into force on April 2.

Germany, which exports 13% of its car shipments to the US, is expected to be particularly affected, which weighs on the prospects of the euro. Trump recently signed a proclamation that enforces tariffs and warned about stricter measures against the EU and Canada if they respond.

In economic data, the GFK consumer confidence survey in Germany for April stood at -24.5, worse than the expectations of -23.0 but marginally improving from the previous -24.6. Investors will be attentive to the data of the business climate and the consumer confidence of the eurozone for March, which will be published later in the day, to obtain more direction in the market.