EUR/GBP Climbs Toward 0.8550 After Weak UK Retail Sales Report

EUR/GBP Rises to 0.8545 After UK Retail Sales Miss Expectations

The EUR/GBP currency pair strengthened to around 0.8545 on Friday during the early European session. The upward momentum came after disappointing UK Retail Sales data for May, which triggered selling pressure on the British Pound (GBP).

UK Retail Sales Disappoint

According to the Office for National Statistics (ONS):

• Retail Sales fell by 2.7% MoM in May, significantly below the forecast of -0.5%.
• Previous month’s figure was revised upward from 1.2% to 1.3%.
• Year-on-year Retail Sales dropped 1.3%, sharply underperforming against a 1.7% growth expectation.

The weak numbers weighed on market sentiment for the GBP, already under pressure following the Bank of England's decision to hold interest rates steady at 4.25% during its June meeting.

Euro Gains as ECB Flags Oil Price Risks

In contrast, the Euro (EUR) benefited from commentary by ECB policymaker François Villeroy, who emphasized that the European Central Bank must closely monitor oil prices when determining the future path of interest rates. This helped sustain bullish sentiment for the Euro.

What to Watch Next

• Eurozone Economic Bulletin
• Eurozone Consumer Confidence Flash
• BoE speeches or any revisions in forward guidance

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• BoE Holds Rates Steady: What’s Next for GBP?
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• EUR/USD and EUR/GBP Technical Forecasts