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Euro slides to six-week lows versus pound as UK data supports BoE

EUR/GBP fell 0.3% on the day to about 0.8540, after UK GDP growth was revised higher and the current account deficit narrowed to GBP 19.9 billion in Q2.

Reported · Written up by our desk · Major Pairs

FXStreet reports the euro dropped sharply versus the British pound on Wednesday, with EUR/GBP sliding to six-week lows around 0.8540. The pair was down 0.3% on the day, and intraday charts pointed to oversold conditions.

The move followed UK data that supported recent claims from Bank of England officials to hike interest rates, according to FXStreet. Final UK GDP data showed growth of 0.5% in the second quarter and 1.4% year over year, alongside a narrowing current account deficit to GBP 19.932 billion in Q2 from a revised GBP 21.12 billion in Q1.

FXStreet also linked the drop to weaker euro zone data from Germany. It cited a 0.4% contraction in retail sales in August after a 2.5% fall in July, while the unemployment rate held at 6.4% but unemployment changes rose more than market expectations.

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