The pound euro (GBP/EUR) exchange rate is falling after gains yesterday.
The euro is gaining despite German economic sentiment slumping in September to an 11-month low. The ZEW economic sentiment fell to 3.6, down from 19.2 and well below the 17.1 expected.
The data points to a deteriorating economic outlook and increased risk of a recession in the eurozone’s largest economy.
The pound is falling despite a quiet economic calendar and PM Kier Starmer saying that the budget won’t undermine growth.
Attention turns to UK inflation data tomorrow, which is expected to show that the CPI remained at 2.2% YoY in August, in line with July.