GBP/EUR: Will Eurozone GDP Data Pull Euro Lower?

The pound euro (GBP/EUR) exchange rate is rising modestly on Wednesday after strong gains yesterday.

Solid UK jobs data lifted the pound. Low unemployment of 3.7 and rising wage growth of 6.4% mounts pressure on the BoE to keep hiking rates aggressively.

UK inflation data is due today and is expected to cool very slightly to 10.5%, down from 10.7%.

The euro trades under pressure after a report yesterday that the ECB was looking to raise interest rates by 25 basis points rather than the 50 basis points expected. German ZEW economic sentiment also rebounded in January to 16.9 above its pre-Ukraine war level.

Attention will turn to Eurozone inflation which is due to confirm the preliminary December reading of 9.2%.