Will the euro rise against the pound? All eyes are on the direction of the market.
25.01.2023
- U.S. MBA Mortgage Applications Index
- UK Producer Price Index (PPI)
In yesterday's U.S. currency trading, the EUR/USD fell following the release of strong U.S. January PMI data. The pair dropped approximately 60 pips from 1.0896 to 1.0835. The decline halted as the 200-period simple moving average (SMA) on the hourly chart provided support.The EUR/USD pair has rebounded during today’s Asian trading session, already offsetting yesterday’s losses. Since the uptrend along the 10-day moving average continues on the daily chart, we will be watching to see if the upward price movement persists.
European currencies rose, with the euro gaining against the pound following yesterday’s release of European PMI data, which showed an increase for the first time in seven months. The EUR/GBP pair rose by approximately 80 pips from 0.8767 to 0.8846, recovering after once again moving above the daily 20-day moving average.From a technical perspective, with the weekly 20-day MA and 200-day SMA forming a golden cross, it is important to carefully assess whether the euro will continue to strengthen against the pound.
Today’s schedule includes the UK Producer Price Index, Turkey’s Economic Sentiment Index, and Turkey’s Capacity Utilization Rate at 16:00 European time; the German IFO Business Climate Index at 18:00; and the US MBA Mortgage Applications Index at 21:00. During US trading hours, the Bank of Canada (BOC) will announce its policy rate and statement at 24:00, followed by US weekly crude oil inventories at 24:30,at 1:00 AM, a press conference by BOC Governor Macklem, and at 3:00 AM, a U.S. 5-year Treasury auction. With the UK PPI release on the horizon, we will carefully assess whether the euro will rise against the pound.
Author: Keisuke Sakurai
