EUR/GBP trades around 0.8650 on Wednesday, slightly lower on the day, as investors weigh rising inflation risks in the Eurozone against mixed macroeconomic signals from the United Kingdom (UK) and Germany.
Nomura analysts note that markets currently price around three rate hikes for the European Central Bank (ECB) by December 2026, implying a similar response to the Iran war energy shock as the Bank of England (BoE).
Deutsche Bank economist Marc Schattenberg notes that the ifo Business Climate Index deteriorated in March as German businesses turned more pessimistic on expectations, while their assessment of current conditions was unchanged.
India M3 Money Supply dipped from previous 11.5% to 10.7% in March 2
Commerzbank’s Dr. Henry Hao and Moses Lim note India's flash March PMIs point to growth moderation rather than a sharp slowdown, as manufacturing softens but external demand stays resilient.
ING’s Chris Turner argues it is premature to expect a sustained Dollar sell-off as Middle East tensions keep energy prices elevated and support safe-haven demand.
United States MBA Mortgage Applications climbed from previous -10.9% to -10.5% in March 20
The EUR/USD pair trades broadly sideways around 1.1600 during the European trading session on Wednesday. The major currency pair consolidates as investors await Iran’s response to United States (US) President Donald Trump’s proposals of a month-long ceasefire and 15-point settlement plan.
Citing a source, who asked not to be named, Reuters reported on Wednesday that Pakistan has delivered the United States' proposal to Iran.
TD Securities notes that President Lagarde used the ECB and Its Watchers conference to outline how the Governing Council is assessing the Middle East conflict shock. The bank says the ECB is effectively playing for time, watching selling price expectations and wage trackers.
Nomura’s Global Markets Research team notes UK CPI inflation held at 3.0% year-on-year in February, matching Bank of England (BoE) forecasts. Services inflation stayed sticky, but core measures eased slightly.
Deutsche Bank analysts report that Euro Area activity is slowing, with the composite PMI dropping to a 10‑month low while still just above the 50 expansion threshold. They emphasize that survey details point to rising input prices, suggesting renewed inflation pressures.
