The pound euro (GBP/EUR) exchange rate is holding steady around €1.1550 and is set to rise across the week after three week’s of losses.
UK GDP came in at 0.2% QoQ in line with forecasts. However, 2022 growth was upwardly revised to 4.3%, helping o boost the pound.
Still the UK economic outlook remains weak with a contraction likely in Q3.
The euro is falling ahead of inflation data. Eurozone inflation is expected to cool to 4.5% YoY from 5.2%. The data comes after German inflation cooled to 4.5% from 6.1%.
Cooler than expected inflation would support the view that the ECB has reached peak rates.