EUR/GBP is trading at 0.8693, down -0.03% on the day
Currently, EUR/GBP is trading at 0.8693, down -0.03% on the day, having posted a daily high at 0.8705 and low at 0.8656.
EUR/GBP has recovered, in the main, from yesterday’s drift to the downside from above the 0.87 handle. However, the Pound is vulnerable to the June 8th election polls that have shown a decrease in the margin that the Conservatives should win by in recent sessions.
“Last night’s TV appearances by PM May and Labour leader Corbyn saw both struggle with certain lines of questioning from interviewers and the audience but neither appears to have made any big mistakes or landed any “knockout” blows. Bookmaker odds this morning continue to reflect a high probability that the Conservatives will win the election (93.3% probability implied by odds today), helping support the GBP,” explained analysts at Scotiabank.
Germany: Feeding doves – ING
Meanwhile, for the euro, the headlines suggesting that Greece may default again and that Italy could call for elections were weighing. The news pushed EUR/USD lower to 1.1109 yesterday and the lowest level in two weeks. However, the euro has also recovered some ground today.
Analysts at Commerzbank noted that EUR/GBP has recently extended gains through the 2017 channel at 0.8702. “However we are extremely cautious and we suspect that this is a false break – the accelerated uptrend has been eroded and this adds weight to that view,” they argued, adding, “last week’s low at 0.8524 guards the 0.8383 May low and failure here will retarget key support at 0.8334/04. If slipped through, the .8252 the July 2016 low would be in focus.”