EUR/GBP jumps to 2-month high

GBP selling pushed the EUR/GBP cross to 0.8683 in Asia; its highest level since March 29. 

UK a sick man of Europe

The tide appears to have turned in favour of the Eurozone nations over the last two months. Strong German economy and ‘peak populism’ in the Eurozone has made EUR denominated assets relatively attractive. 

On the other hand, we have a slowing economy and high inflation in the UK. Consequently, UK is increasingly looking like a sick man of Europe. No wonder, the EUR/GBP pair has jumped to a two-month high today. 

The bid tone may remain intact ahead of the UK general elections due on June 8. 

EUR/GBP Technical Levels

The cross was last seen trading around 0.8683. A break above 0.8689 (Mar 28 high) would open up upside towards 0.8735 (Mar 29 high) and 0.8787 (Mar high). On the other hand, a breakdown of support at 0.8652 (5-DMA) could yield a technical pullback to 0.8613 (10-DMA) and 0.8595 (200-DMA).