EUR/GBP clocks 4-day high on downward revision of UK Q2 GDP

EUR/GBP rose to a 4-day high of 0.8817 after the UK Office for National Statistics [ONS] revised the second quarter GDP lower to 1.5% y/y from the previous estimate of 1.7%.

Trades above 1-hour 200-MA

At press time, the cross is trading above the 1-hour 200-MA level of 0.8808. The offered tone around Sterling strengthened following the downward revision of the GDP. The current account deficit rose more than expected to £23.2 billion. Meanwhile, the household savings ratio rose to 5.4% from 3.8% in Q1.

With UK GDP out of the way, the focus shifts to Eurozone preliminary CPI release. The Eurozone core CPI is seen rising 1.2% y/y vs. previous figure of 1.3%. A better-than-expected number could boost the common currency.

EUR/GBP Technical Levels

A break above 0.8839 [Sep 25 high] would open up upside towards 0.8890 [100-DMA] and 0.89 [zero levels]. On the other hand, a break below 0.8808 [1-hour 200-MA] could yield a sell-off to 0.8779 [1-hour 100-MA] and 0.8773 [1-hour 50-MA].