EUR/GBP Near Support on Diverging Inflation Data

Key Moments

EUR/GBP has traded just above the 0.8655 support area after falling nearly 0.7% this week.
Eurozone HICP confirmed annual inflation at 3% in April, up from 2.6% in March, intensifying pressure on the ECB.
UK inflation eased more than anticipated in April, weighing moderately on the Pound and giving the BoE room to keep policy unchanged in June.

EUR/GBP Steadies After Weekly Slide

The Euro (EUR) has remained under mild pressure against the British Pound (GBP) on Wednesday, trading just above the 0.8655 support zone after losing nearly 0.7% so far this week. The cross has been caught between contrasting inflation dynamics in the Eurozone and the UK, with data releases from both regions shaping expectations for central bank policy.

UK consumer price figures have exerted some pressure on the Pound, while the Eurozone’s final Harmonized Index of Consumer Prices (HICP) has not delivered the support the Euro might have needed to recover recent losses.

Eurozone and UK Inflation Data Drive Policy Expectations

Eurozone HICP confirmed that annual inflation accelerated to 3% in April from 2.6% in March. This pick-up in price growth has added to the pressure on the European Central Bank to consider further interest rate hikes, despite signs of weakening economic activity across the bloc.

In contrast, UK consumer inflation eased more than expected in April. The softer outcome has provided some flexibility for the Bank of England to leave its monetary policy settings unchanged in June. The Pound responded with moderate declines, but this has not been enough to fully offset the Euro’s broader weakness against GBP this week.

Technical Picture: Bears Target Key Support Levels

From a technical perspective, EUR/GBP’s short-term bias has shifted to bearish this week, following a sharp reversal from last week’s highs. On the 4-hour chart, the Relative Strength Index (RSI) is hovering around 39, indicating ongoing downward pressure. The Moving Average Convergence Divergence (MACD) remains in negative territory, signaling that recent upside attempts are likely corrective in nature rather than the start of a sustained recovery.

Sellers are testing the 0.8655 area, with attention centered on the one-week low near 0.8645. A move below that level would bring the May 11 low at 0.8630 into focus as the next downside objective.

The pair has also confirmed a break below the 200-period moving average on the 4-hour timeframe, a widely watched technical marker. This moving average is expected to act as significant resistance near 0.8680, where it converges with the 38.2% Fibonacci retracement of this week’s decline and Tuesday’s high above 0.8685. On the upside, the 61.8% Fibonacci retracement aligns with the March 15 lows around the 0.8700 area, forming another key resistance zone.

(The technical analysis of this story was written with the help of an AI tool.)

Euro Performance Against Major Currencies This Week

The following table presents the percentage change of the Euro (EUR) against major currencies this week. According to these figures, the Euro has shown its strongest performance versus the Australian Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD	—	0.17%	-0.55%	0.14%	0.14%	0.38%	0.02%	0.37%
EUR	-0.17%	—	-0.73%	0.04%	-0.05%	0.20%	-0.08%	0.17%
GBP	0.55%	0.73%	—	0.70%	0.70%	0.92%	0.66%	0.89%
JPY	-0.14%	-0.04%	-0.70%	—	-0.05%	0.17%	-0.17%	0.19%
CAD	-0.14%	0.05%	-0.70%	0.05%	—	0.23%	-0.12%	0.20%
AUD	-0.38%	-0.20%	-0.92%	-0.17%	-0.23%	—	-0.28%	0.05%
NZD	-0.02%	0.08%	-0.66%	0.17%	0.12%	0.28%	—	0.23%
CHF	-0.37%	-0.17%	-0.89%	-0.19%	-0.20%	-0.05%	-0.23%	—

Reading the Currency Heat Map

The heat map reflects percentage changes between major currencies. The base currency is taken from the left-hand column, while the quote currency is selected from the top row. For instance, choosing the Euro in the left column and moving across to the US Dollar cell shows the percentage change for EUR (base)/USD (quote).