EUR/GBP Holds Range Ahead of German Employment Data

In the early European trading session on Wednesday, EUR/GBP maintained a range between 0.8665 and 0.8675. Investors are eagerly awaiting the release of German employment data for December, with the unemployment rate anticipated to remain steady at 5.9%. The cross is currently trading around 0.8670, experiencing a marginal decline of 0.02% for the day.

The UK manufacturing industry witnessed a decline in December 2023, as indicated by the country’s S&P Global PMI, which recorded 46.2 compared to the previous value of 46.4, falling below market expectations. Concerns about a technical recession and a pessimistic outlook for the UK economy have exerted selling pressure on the pound, contributing to the upward movement of EUR/GBP.

Contrastingly, the HCOB Manufacturing Purchasing Managers’ Index in the Eurozone rose to 44.4 in December from the previous figure of 44.2, surpassing market expectations. Similarly, the German manufacturing purchasing managers index outperformed predictions, reaching 43.3 in December compared to the earlier value of 43.1.

Focus now shifts to the upcoming release of German employment data, encompassing the unemployment rate and changes in the number of unemployed individuals, scheduled for Wednesday. Subsequently, Thursday will bring the Eurozone HCOB Comprehensive PMI and Services PMI, along with the Consumer Price Index for December. These reports are poised to provide valuable insights into the potential direction of EUR/GBP.

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