- The pound is one of the worst performing currencies on Wednesday.
- UNITED KINGDOM: Indebtedness was higher than expected in November.
- EUR/GBP bullish, eyes on 0.8800 and higher.
The pair EUR/GBP gained momentum during the European session and rose to 0.8780, hitting the highest level since November 15. Then it fell back, finding support at 0.8745 and after the start of the American session, it is close to daily maximums.
The euro shot up last week after the meetings of the European Central Bank and the Bank of England, surpassing 0.8700 points. After pausing and holding above 0.8700, EUR/GBP seems to resume the bullish path. If the recovery continues, the next level to watch is the November high at 0.8825/30.
Key support for the current move higher is at 0.8670, the 50-day SMA. A break down could return EUR/GBP to the previous range between 0.8550 and 0.8660.
The pound is affected by the data
Data released on Wednesday showed the British government borrowed 22 billion pounds in November, above the 8 billion that markets had expected. It was a record for the month. The energy price support plan and the effects of inflation are affecting British public finances.
Rabobank analysts they believe that UK fundamentals will remain “sour” in the coming months. They see the pound vulnerable and expect EUR/GBP to rise to 0.90 on a six to nine month outlook.
technical levels
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
