EUR/GBP trims gains following German inflation data – Crypto News

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• The EUR/GBP is trading at 0.8550, after peaking at a high of 0.8570.
• The Core HICP in Germany grew at a slower pace than expected in February.
• Soft inflation figures fuel the hopes of sooner cuts by the ECB.

the EUR/GBP pair recorded a slight gain in Thursday’s session but gave up gains which took the pair to a high of 0.8570. This comes on the heels of softer inflation data from Germany’s Harmonized Index of Consumer Prices (HICP), which fueled bets of sooner policy shifts by the European Central Bank (ECB).

February’s preliminary HICP from Germany, showed a continued but slower inflation rate at 2.7% year-on-year, aligning with forecasts yet decreasing from January’s 3.1%. The monthly inflation rate was as anticipated at 0.6%, a rebound from January’s 0.2% decline. Core inflation, a key focus for the ECB, rose by 2.5%, slightly below the expected 2.6% and down from the previous 2.9%. This slowdown in core inflation growth suggests potential early policy adjustments by the ECB, as President Christine Lagarde hinted at possible rate cuts in the upcoming summer with over 100 bps of easing expected by the European bank in 2024.

EUR/GBP technical analysis

Considering the Relative Strength Index (RSI) for the EUR/GBP pair, the index holds in positive territory, confirming the market is primarily influenced by buyers at the current moment but its flat nature, suggests a market equilibrium, with neither buyers nor sellers gaining additional ground.

Regarding the Moving Average Convergence Divergence (MACD) histogram, it exhibits a falling trend with a sequence of decreasing green bars, which portrays a picture of negative momentum building up. This combination of signals suggests that the buyers are struggling to hold their momentum, but in case they hold above the 20-day Simple Moving Average (SMA) the outlook for the short term, may remain somewhat positive.

EUR/GBP daily chart