- EUR/GBP consolidates in the area of highs in days, but without extending advance.
- Inflation in the United Kingdom sets new highs.
- The ECB is coming on Thursday.
The EUR/GBP is trading range-bound and stable despite a host of ongoing events centered in Europe. The cross reached as high as 0.8540, the highest since July 7, before falling to 0.8500 and stabilizing around 0.8520.
From inflation to the ECB, passing through Italy
In the United Kingdom it was known that retail inflation rose to 9.4% (annual) over the 9.3% expected. In Germany, producer prices rose 32.7%, down from 33.6%.
Italian bond yields are having a highly volatile day, with the focus on the possibility that Mario Draghi’sHe is still the Prime Minister of Italy.
Another current focus is the energy crisis. On Thursday the flow of Russian gas to Europe should resume. There is uncertainty in this regard and the European Union warned about the negative impact on growth of not carrying out contingency plans.
Despite the above, What attracts the most attention is the ECB meeting on Thursday. A rise of 25 basis points is expected, although there would be those who seek a higher rise. In addition, the central bank will explain its anti-fragmentation instrument, to avoid a large spread between European bonds.
EUR/GBP has been making up ground in recent days, partly on expectations of a more hawkish ECB. The euro is expected to have a big reaction to what the ECB says on Thursday.
Technical levels
Source: Fx Street
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