Expectations are the pound will struggle to gain any momentum against the Euro over the coming days.
Currency analysts believe the decline for the GBP/EUR is due to issues facing the economy and the Bank of England’s stance on monetary policy, both of which are unlikely to reverse anytime soon.
A subdued economic outlook and the imminent end to the Bank of England interest rate hiking cycle comes at a time when the Federal Reserve and European Central Bank (ECB) are intent to hike further.
Although there have been some bright spots in UK economic data of late – PMIs show the economy likely expanded in February – economists say they have not yet seen enough to overturn expectations for an economic contraction in 2023. European retail sales YOY for January came in better than previous but worse than forecast, this did nothing to weaken the euro as between this data coming out and 5pm we saw the pound drop off against the euro.
Later on today we have US Fed Chair Powell Testimony where he will talk about monetary policy and what the feds objectives are so depending on what he says we could see some major movements in regards to the USD.