Forex - EUR/GBP hits 1-week high on Greece loan deal hopes
Investing.com
Published May 31, 2011 08:52AM ET
EUR/GBP hit 0.8745 during European afternoon trade, the pair’s highest since May 24; the pair subsequently consolidated at 0.8731, surging 0.71%.
The pair was likely to find support at 0.8654, Monday’s low and resistance at 0.8837, the high of May 20.
Earlier in the day, the Wall Street Journal reported that Germany may consider abandoning a push to reschedule Greek debt early, which may pave the way for Greece to receive a new package of financial aid.
The European Union is drafting a second bailout package for Greece to release vital loans next month and avert the risk of it defaulting.
Elsewhere, concerns over the U.K.‘s fragile economic recovery were underlined on Monday, after industry data showed house prices falling at their fastest annual pace in over one-and-a-half years in May, while the British Chambers of Commerce cut its growth forecast for the year.
The data reinforced expectations that the Bank of England is likely to keep interest rates on hold this year.
The euro was also up against the U.S. dollar, with EUR/USD gaining 0.74% to hit 1.4390.
Also Tuesday, the euro shrugged off data showing that consumer price inflation in the euro zone rose less-than-expected in May, rising by a seasonally adjusted 2.7%. Analysts had expected CPI to remain unchanged at 2.8%.
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Written By: Investing.com
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