EUR/GBP spikes to session tops, around 0.9230 post-EZ CPI

After yesterday's sharp pull-back, the EUR/GBP cross regained some fresh traction on Thursday and was seen building on early up-move following the release of EZ inflation figures.

With investors looking past today’s disappointing releases of German retail sales and Italian unemployment rate, the latest Euro-zone CPI print for August provided an additional boost to the pair's positive momentum. 

According to flash estimates, published by Eurostat, the headline inflation in the region is seen inching higher to 1.5% y-o-y for August, up from previous month's reading of 1.3% and better-than 1.4% consensus. Meanwhile, the core CPI, which excludes food, energy, alcohol, and tobacco, is also expected to tick higher to 1.3% during the reported month.

Apart from the bullish EZ data, an offered tone around the GBP/USD major, despite of some hawkish comments from BOE MPC member Saunders further collaborated to the pair’s up-move to session tops, around 0.9230 level. 

   •  BOE’s Saunders: A rise of 0.25% in bank rate would be quite small

Technical levels to watch

On a sustained move beyond 0.9235 level, bullish momentum could get extended towards 0.9265-70 horizontal resistance before the cross eventually darts back towards reclaiming the 0.9300 handle.

On the flip side, retracement back below 0.9215 now might now find support near the 0.9200 handle, which if broken could accelerate the fall towards 0.9160 level.