EUR/GBP rose nearly 0.3% on Monday, testing resistance around the 0.8360 level. The move was supported by a reversal in oil prices and by revised-higher eurozone manufacturing data. Sterling did not gain support from the UK’s final manufacturing reading.
Eurozone factories firm
The final HCOB eurozone manufacturing PMI came in at 52.7, up from the preliminary reading of 52.4. That was just short of September’s 52.9. Italy’s activity contracted unexpectedly, while France and Spain were revised higher.
Germany’s final manufacturing PMI also stood at 52.7. The revisions narrowed the gap with the previous month and gave the euro a firmer footing against sterling.
Sterling lacks support
The figure confirmed the preliminary data. Even so, it did not lift the pound, which slipped against the euro.
Markets are looking ahead to the Bank of England. Some traders expect a quarter-point rate hike on Thursday. That expectation has so far done little for sterling.
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Technical levels in focus
EUR/GBP was trading near 0.8356 at the time of writing. Resistance sits at 0.8380, the October 28 high, with a further barrier at 0.8400, the October 26 high. Support lies at 0.8320, Friday’s low, and then in the 0.8220 to 0.8240 area.
