Wednesday, September 16, 2015

EUR/GBP attacks 0.7300 on solid UK jobs report

FXStreet (Mumbai) - EUR/GBP cross ran through fresh offers in the European morning, after the pound spiked to fresh highs versus the common currency on the back of stronger UK jobs report.

EUR/GBP slips from 0.7340

Currently, the EUR/GBP pair drops -0.52% to fresh four-day lows of 0.7304, on its way to test 0.73 barrier. The EUR/GBP cross dropped sharply following the release of the UK’s labour market report which revealed that the unemployment rate in the British economy slid down in the quarter to July to its lowest rate in seven years while wages rose.

The unemployment rate dropped to 5.5% in July, above expectations. The rate was unchanged compared with February to April 2015, but higher than for a year earlier. However, the claimant count rate remained at 2.3% in August, its lowest rate since February 1975. While the wages continued to climb with pay excluding bonuses rising by 2.9%

Whilst, the losses in the EUR/GBP cross were also exacerbated by a weaker euro versus the greenback as markets now await the EU CPI figures for further momentum. Consumer prices in the euro zone are seen flat in August, on a monthly basis, compared to a negative 0.6% result in July.

EUR/GBP Technical Levels

To the upside, the next resistance is located at 0.7375 (Sept 3 High) levels and above which it could extend gains to 0.7400 levels. To the downside immediate support might be located at 0.7292 (Sept 11 Low) below that at 0.7243 (Aug 31 Low).
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