EUR/GBP rises about 0.8350 after the weak British CPI data

  • The EUR/GBP can be seen after the publication of the data of the United Kingdom consumer price index on Wednesday.
  • The United Kingdom IPC increased by 2.8% year -on -year, below the expected 2.9%.
  • The euro faced challenges amid the expectations that the European Central Bank could reduce interest rates again in April.

The EUR/GBP pair regained ground on Wednesday after the publication of disappointing consumer price index (CPI) of the United Kingdom (United Kingdom). The pair is currently being negotiated around 0.8340 during the hours of the Asian market.

In February, the United Kingdom CPI rose 2.8% year -on -year, slowing down from the 3.0% increase in January and being below market expectations of 2.9%. Despite the fall, inflation is maintained above the 2% target of the Bank of England (BOE). Meanwhile, the underlying IPC, which excludes food and energy prices, increased 3.5% year -on -year, decreasing from January 3.7% and being below the 3.6% prognosis.

The sterling pound (GBP) faced additional pressure after the BOE maintained interest rates without changes in 4.5% last week. Eight of the nine members of the Monetary Policy Committee (CPM) voted in favor of maintaining current indebtedness costs, while the policy officer Swati Dhingra was the only one to support a rate cut of 25 basic points (BPS). Economists had anticipated that two officials could favor a reduction.

However, EUR/GBP profits could be limited since the euro is still under pressure amid the expectations that the European Central Bank (ECB) could lower interest rates again in April. The Governing Council member of the ECB, François Villeroy of Galhau, declared on Tuesday that more rates cuts are possible and that the 2.5% deposit rate could fall to 2% by the end of summer.

Meanwhile, the president of the ECB, Christine Lagarde, told the European Parliament last week that the inflationary impact of commercial tensions promoted by US president, Donald Trump, would be temporary, since a weaker economic activity would eventually relieve inflationary pressures.

Economic indicator

Consumer Price Index (Yoy)

The IPC publishes it National Statistics and measures prices a basket of goods and services bought by households for consumption. The CPI is the main indicator to measure inflation and changes in consumption trends. A greater result than expectations is bullish for the pound, while a minor reading is bassist.


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Last publication:
LIE MAR 26, 2025 07:00

Frequency:
Monthly

Current:
2.8%

Dear:
2.9%

Previous:
3%

Fountain:

Office for National Statistics


The Bank of England has the task of maintaining inflation, measured by the main consumer price index (CPI), in about 2%, which gives the monthly publication its importance. An increase in inflation implies an increasingly fast increase in interest rates or the reduction of bond purchase by the BOE, which means squeezing the offer of pounds. On the contrary, a drop in the rhythm of price increases indicates a more flexible monetary policy. A higher result than expected tends to be bullish for the GBP.

Source: Fx Street

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