Investing.com - The euro rallied against the pound on Tuesday, hitting a two-day high as positive consumer sentiment and consumer price inflation data from the euro zone boosted demand for the single currency.
EUR/GBP hit 0.8319 during European morning trade, the pair’s highest since January 13; the pair subsequently consolidated at 0.8313, climbing 0.56%.
The pair was likely to find support at 0.8254, the low of January 16 and resistance at 0.8371, the high of January 1.
Data showed earlier that German economic sentiment improved significantly more-than-expected in January, rising to the highest level since July 2011.
The ZEW Centre for Economic Research said that its index of German economic sentiment improved to minus 21.6 in January, compared to the previous month’s reading of 53.8.
Analysts had expected the index to improve to minus 49.2 in January.
The ZEW index of economic sentiment in the euro zone also improved significantly in January, rising to minus 32.5 from minus 54.1.
Meanwhile, a separate report showed that consumer price inflation in the single currency bloc rose less-than-expected in December, advancing 2.7% after a 2.8% rise the previous month.
Analysts had expected CPI to rise 2.8% in December.
Earlier in the day, the euro found support after better-than-forecast data on Chinese economic growth boosted demand for riskier assets.
The data came after ratings agency Standard & Poor’s downgraded the triple-A rating of the euro zone’s bailout fund by one notch, following Friday’s downgrade of nine euro zone sovereigns, including France.
Elsewhere, the pound was also higher against the U.S. dollar with GBP/USD gaining 0.43%, to hit 1.5392.
Also Tuesday, official data showed that consumer price inflation in the U.K. rose 4.2% in December, in line with expectations, after a 4.8% increase the previous month.
Later in the day, the U.S. was to produce a report on manufacturing activity in New York State.
EUR/GBP hit 0.8319 during European morning trade, the pair’s highest since January 13; the pair subsequently consolidated at 0.8313, climbing 0.56%.
The pair was likely to find support at 0.8254, the low of January 16 and resistance at 0.8371, the high of January 1.
Data showed earlier that German economic sentiment improved significantly more-than-expected in January, rising to the highest level since July 2011.
The ZEW Centre for Economic Research said that its index of German economic sentiment improved to minus 21.6 in January, compared to the previous month’s reading of 53.8.
Analysts had expected the index to improve to minus 49.2 in January.
The ZEW index of economic sentiment in the euro zone also improved significantly in January, rising to minus 32.5 from minus 54.1.
Meanwhile, a separate report showed that consumer price inflation in the single currency bloc rose less-than-expected in December, advancing 2.7% after a 2.8% rise the previous month.
Analysts had expected CPI to rise 2.8% in December.
Earlier in the day, the euro found support after better-than-forecast data on Chinese economic growth boosted demand for riskier assets.
The data came after ratings agency Standard & Poor’s downgraded the triple-A rating of the euro zone’s bailout fund by one notch, following Friday’s downgrade of nine euro zone sovereigns, including France.
Elsewhere, the pound was also higher against the U.S. dollar with GBP/USD gaining 0.43%, to hit 1.5392.
Also Tuesday, official data showed that consumer price inflation in the U.K. rose 4.2% in December, in line with expectations, after a 4.8% increase the previous month.
Later in the day, the U.S. was to produce a report on manufacturing activity in New York State.