EUR/GBP fell back Thursday after the European Central Bank tightened monetary policy only minimally, and barely reacted at all to Friday’s mixed bag of UK economic data that showed lower than expected increases in growth offset by better than predicted industrial production figures.
That means next Tuesday’s UK labor-market figures and, especially, Wednesday’s inflation data are next up for fundamental GBP traders. The consensus among economists polled by the news agencies is that the headline year/year inflation rate will increase to 3% from 2% but an undershoot is possible given the weak GDP data and that would help EUR/GBP to rally, perhaps to the 0.86 if that level has not already been reached by Wednesday.
