Anna 
During the early European session on Friday, the EUR/GBP pair rebounded, approaching the 0.8590 level after trimming its earlier intraday losses. Despite upbeat Retail Sales data from the United Kingdom (UK), the cross remains in negative territory.
UK Retail Sales figures for February indicated stagnant growth, registering at 0.0% month-on-month, contrary to the anticipated 0.3% decline and following January’s robust 3.4% expansion. However, Core Retail Sales, excluding auto and motor fuel sales, exceeded expectations by increasing 0.2% month-on-month, maintaining the 3.2% growth observed in January.
Bank of England (BOE) Governor Andrew Bailey reiterated the possibility of rate cuts this year, emphasizing that decisions are contingent on evolving circumstances. Bailey stressed the importance of confidence in wage growth direction and dismissed the notion of waiting for inflation to reach 2% before considering rate adjustments, expressing optimism about recent economic developments.
Meanwhile, the Euro faced downward pressure following the release of the Eurozone Purchasing Managers Index (PMI) survey by HCOB on Thursday. The Eurozone Manufacturing PMI for March fell to 45.7, below the previous reading of 46.5 and the consensus forecast of 47.0. However, the Services PMI improved to 51.1 in March from 50.2 in February, surpassing the estimated 50.5. The Eurozone PMI Composite rose to 49.9 in March, exceeding expectations and the previous reading of 46.3.
Additionally, Friday’s report on the German Import Price Index for January showed no change at 0.0% month-on-month, contrary to the expected decline of 0.3%. Year-over-year, the index indicated a smaller decline of 5.9% compared to the anticipated 7.4% and the previous 7.0% decrease.
