EUR/GBP: the euro ends the week with modest gains

Apr 17, 2026, 7:45:43 AM

Current trend

During the morning session, the EUR/GBP pair has corrected upward, consolidating above 0.8700 and testing 0.8715, and is on track to end the week in positive territory.

It’s worth noting that macroeconomic statistics from the UK failed to provide support for the pound, although in February, gross domestic product (GDP) increased from 0.0% to 0.5% MoM, reaching its highest level since April and significantly exceeding forecasts of 0.1%. Industrial production accelerated from –0.1% to 0.5, suggesting the national economy is more resilient than expected. Although these data do not reflect the impact of the Middle East conflict and may weaken significantly in March, they have reduced the likelihood of an immediate shift to the Bank of England’s monetary policy: Governor Andrew Bailey emphasized the need to consider secondary effects before assessing the impact of the energy crisis.

European investors are focusing on the March consumer price index, which increased from 1.9% to 2.6%, a two-year high, and exceeded forecasts of 2.5%, driven primarily by the rise in energy prices from –3.1% to 5.1% YoY. More important for the European Central Bank (ECB) is the core indicator, which excludes volatile food and fuel prices, which slowed from 2.4% to 2.3%. There has been limited pass-through of increased energy costs to other goods and services, allowing the regulator to maintain a wait-and-see stance. On the other hand, the service sector’s contribution to inflation was 1.49 percentage points, a worrying sign for policymakers.

Against this backdrop, markets have revised their expectations for further changes to the ECB’s monetary policy. Just a few weeks ago, officials were considering raising the interest rate in April, but now its representatives, including President Christine Lagarde, Chief Economist Philip Lane, and Governing Council member Isabelle Schnabel, have indicated their preference for more data on the impact of the Middle East conflict on economic indicators. Furthermore, Lagarde, in an interview with Bloomberg TV, stated that the future path of monetary policy is still unknown, as the consequences of the conflict with Iran for the bloc’s economy remain unclear, and the current scenario fluctuates between the baseline and worst-case scenarios. Madis Müller, Governor of the Bank of Estonia, shares a similar opinion, stating that the regulator does not have sufficient information to adjust interest rates this month.

Support and resistance

On the daily chart, Bollinger Bands are flattening. The price range remains virtually unchanged, remaining wide for the level of market activity. The MACD indicator is moving upward, generating a buy signal (the histogram is holding above the signal line), and the Stochastic has sharply reversed to the upside in the middle of the trading range.

Resistance levels: 0.8721, 0.8732, 0.8741, 0.8757.

Support levels: 0.8702, 0.8692, 0.8683, 0.8670.

 

Trading tips

Long positions can be considered after a breakout above 0.8721 with the target at 0.8757. Stop loss is 0.8702. Implementation period: 2–3 days.

Short positions can be considered after a rebound from the 0.8721 level and a break below the 0.8702 level with the target at 0.8670. Stop loss is 0.8721.

Scenario

Time frame	Intraday
Recommendations	BUY STOP
Entry Point	0.8725
Take Profit	0.8757
Stop Loss	0.8702
Support levels	0.8670, 0.8683, 0.8692, 0.8702, 0.8721, 0.8732, 0.8741, 0.8757

Alternative scenario

Recommendations	SELL STOP
Entry Point	0.8700
Take Profit	0.8670
Stop Loss	0.8721
Stop Loss	0.8670, 0.8683, 0.8692, 0.8702, 0.8721, 0.8732, 0.8741, 0.8757