Recent economic data on the Eurozone were not particularly optimistic. Today’s French manufacturing data is weaker than expected while Italy’s economic and political situations remain modestly concerning.
As a result, the Euro weakened slightly today. GBPEUR found temporary support at 1.13 to rebound back into 1.14. But an upside breakout is by no means certain due to similarly poor macro headlines on the UK economy. It is now a battle of ‘who is weaker’. Technically, GBP has the upper hand at the moment although this advantage can vanish quickly on, say, poorly negotiated Brexit trading arrangements.
For GBPUSD, the rate found support at 1.3500 to pause the decline. We maintain the view that the rate is oversold.
Jackson has over 10 years experience as a financial analyst. Previously a director of Stockcube Research as head of Investors Intelligence providing market timing advice and research to some of the world largest institutions and hedge funds.
Expertise: Global macroeconomic investment strategy, statistical backtesting, asset allocation, and cross-asset research.
Jackson has a PhD in Finance from Durham University.