EUR/GBP rises ahead of ECB, BoE rate decisions

ForexNewsNow | Published on July 7, 2010 at 6:07 pm

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NEW YORK (Forex News Now) – The euro rose against sterling on Thursday, paring the previous day’s losses, as FX traders awaited key interest rate decisions by the European Central Bank and Bank of England.

In early Asian currency trading, EUR/GBP traded at 0.8326, up 0.13 percent on the day.

The European Central Bank, meanwhile, was seen as likely to leave its key interest rate at 1 percent, a record low, for the 14th consecutive month, amid persisting concerns over the financial health of Europe’s banking sector and a modest recovery for the euro.

The Bank of England, for its part, was expected to hold its benchmark interest rate steady at a historic low 0.5 percent, as it mulls the impact of the government’s austerity measures on the fragile U.K. economic recovery.

According to forex analysis, EUR/GBP is likely to touch immediate support around the low of June 29, 0.8067, and encounter resistance around the high of June 1, 0.8474.

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Britain’s statistics bureau was also due to publish key data on the U.K. manufacturing sector on Thursday, which was set to be released shortly after a report on the British housing market.

Meanwhile, sterling rose versus the dollar: GBP/JPY traded at 133.63, up 0.3 percent on the day.

 

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