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EUR/GBP climbs to a two-month high near 0.8575 following the release of preliminary June PMI data from the UK and Eurozone.
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Eurozone Composite PMI showed steady growth, while UK PMI figures surpassed expectations.
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Market focus shifts to ECB President Lagarde’s upcoming speech for further monetary policy guidance.
The EUR/GBP pair climbed to a fresh two-month high near 0.8575 during Monday’s European session, holding broadly steady after the release of preliminary UK and Eurozone PMI data for June. While both economies showed signs of resilience, diverging sector performance and expectations around monetary policy are shaping the pair’s short-term direction.
According to the flash HCOB Eurozone PMI report, overall business activity continued to expand but fell short of expectations. The Services PMI rose to the neutral 50.0 mark from 49.7 in May, signaling a recovery from contraction. In contrast, the Manufacturing PMI remained in contraction territory, unchanged at 49.4.
Market participants are now focused on the upcoming speech by ECB President Christine Lagarde at 13:00 GMT, where she is expected to provide guidance on the central bank’s monetary policy stance for the remainder of the year. Any dovish or hawkish shift could influence the Euro’s trajectory against its counterparts.
In the United Kingdom, the flash S&P Global PMI for June surprised to the upside. The Composite PMI climbed to 50.7, beating forecasts of 50.5 and May’s reading of 50.3. While manufacturing activity contracted moderately, the services sector expanded at a stronger pace, helping support the Pound and limiting the Euro’s upside.
Technical Analysis: EUR/GBP Maintains Bullish Bias Above 0.8500
From a technical standpoint, EUR/GBP has extended its nearly month-long recovery, trading above the 50% Fibonacci retracement level at 0.8540, drawn from the April 11 high of 0.8739 to the May 29 low of 0.8356. The 20-day Exponential Moving Average (EMA), rising around 0.8500, reinforces the bullish near-term outlook.
The 14-day Relative Strength Index (RSI) continues to hold above the 60.00 level, indicating sustained positive momentum.
To the upside, a break above the 61.8% Fibonacci retracement at 0.8590 could open the door toward the April 21 high at 0.8624, followed by the 78.6% retracement at 0.8655.
On the downside, initial support lies at the June 2 high of 0.8450. A drop below that could expose further downside targets at the June 4 high of 0.8407, and ultimately, the May 29 low of 0.8356.
Overall, the technical and fundamental backdrop points to continued bullish pressure on EUR/GBP in the near term, especially if the ECB strikes a cautious tone or UK data momentum fades.
EUR/GBP daily chart
