- .Pound is among the worst performers on Thursday.
- The euro falls against the dollar, but remains firm against the Swiss franc.
- EUR/GBP rises for the third day in a row and breaks above the 20-day SMA again.
The EUR/GBP is up for the third day in a row and recently hit a three-day high at 0.8818 before pulling back to 0.8790. The cross bottomed out on Tuesday at 0.8644 and has since moved higher. It has again exceeded the 20-day moving average. The next resistance zone is at the weekly high around 0.8830 and then at 0.8895. Critical support for the current bias could be seen at 0.8740, an uptrend line from Wednesday’s low.
The euro and the pound fell against the dollar, trimming weekly gains. GBP/USD decline is faster and is approaching 1.1100, while EUR/USD is approaching 0.9800. EUR/CHF remains stable near 0.9700.
Market Participants see the Bank of England and the European Central Bank on the path to further rate hikes in upcoming meetings. However, the BoE’s actions are not only to curb inflation, but also to preserve stability in the gilt market.
On Thursday, the BoE defended last week’s interventions in the gilt market, saying it prevented a £50bn sell-off of British bonds that would have brought the brink of a financial crisis. The pound is not out of the woods yet. It remains among the most volatile currencies and, after a strong recovery, is showing weakness again.
ECB minutes released on Thursday showed discussions about the size of the rate hikes and concerns about the impact of the euro’s depreciation on inflation expectations. “The narrative of the September ECB Council meeting points to a growing number of arguments in favor of further significant ECB rate hikes in the near term, while the exact level of the terminal rate remains unclear,” they said. Commerzbank analysts.
Technical levels
Source: Fx Street
With 6 years of experience, I bring to the table captivating and informative writing in the world news category. My expertise covers a range of industries, including tourism, technology, forex and stocks. From brief social media posts to in-depth articles, I am dedicated to creating compelling content for various platforms.
