Euro remains depressed against British Pound despite upbeat German GDP figures
The Euro (EUR) extends losses for the fourth consecutive day against the British Pound (GBP) on Tuesday, testing weekly lows in the 0.8550 area despite the upward revision to German Q2 Gross Domestic Product (GDP) earlier in the day.
The Euro continues to struggle against the British Pound, even with impressive German GDP growth figures released earlier in the day. On Tuesday, the EUR/GBP pair tested weekly lows around 0.8550, despite the upward revision of Germany's Q2 Gross Domestic Product (GDP) to a 0.3% growth rate, which surpassed initial estimates of 0.2%.
The yearly increase was also revised up to 1%, from the preliminary estimate of 0.9%. Analysts at ING believe that the EUR/GBP pair may remain near the 0.8550 level due to the current low volatility environment and the higher volatility-adjusted nature of the British Pound. Sterling is currently benefiting from moderate risk aversion, particularly as tensions in the Middle East escalate after the US announced new sanctions against Iran and threatened military action in the Strait of Hormuz.
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