EUR/GBP rises to five-month highs near 0.8750 ahead of Eurozone data

• EUR/GBP continues its bullish streak despite lower-than-expected German retail sales.
• Investors await the HICP and Eurozone GDP data for economic information on the Eurozone.
• The Bank of England is expected to keep interest rates at 5.25%, which will weaken the Pound Sterling.

The EUR/GBP cross continues its bullish streak for the third day in a row, reaching five-month highs around 0.8745 during the European session on Tuesday. The pair receives bullish support despite weakness in German retail sales, which fell 4.3% year-on-year in September versus the previous drop of 2.3%.

Elsewhere, Germany’s preliminary Harmonized Consumer Price Index (HICP) for October, released on Monday, fell 0.2% month-on-month versus the expected 0.1% rise, a change from the 0.2% rise. % of September. For its part, the annual index fell to 3.0% from the previous 4.3%, below the expected 3.6%.

On the other hand, German GDP for the third quarter contracted, although the contraction was smaller than expected, still showing a negative reading of 0.1% compared to the market consensus of a 0.3% decline.

Investors will closely monitor upcoming Eurozone data on Tuesday, including the Harmonized Index of Consumer Prices (HICP), core HICP and seasonally adjusted Gross Domestic Product (GDP). These indicators could provide crucial information on inflationary pressures and economic performance in the euro zone.

The Bank of England’s (BoE) forecast to keep interest rates at 5.25% in Thursday’s decision is a major factor weakening market sentiment towards the British Pound (GBP).

Investors are also likely to closely monitor the BoE’s Monetary Policy Committee (MPC) report. The MPC reports provide information on internal dynamics and consensus among policymakers, offering clues about the central bank’s stance on monetary policy.