Pound-Euro Rangebound as PMI Data Fails to Inspire

– Written by


Minesh Chaudhari

STORY LINK Pound-Euro Rangebound as PMI Data Fails to Inspire

The Pound Euro (GBP/EUR) exchange rate moved sideways on Wednesday after the latest UK and Eurozone PMI releases offered little clear direction.

At the time of writing, GBP/EUR was trading at €1.1576, largely unchanged on the day.

The Pound (GBP) traded without clear momentum on Wednesday after the UK’s final services PMI confirmed a contraction in the sector.

May’s finalised reading was revised up from the preliminary estimate of 47.9 to 49.3, offering some modest reassurance to GBP investors.

However, the figure still marked a sharp slowdown from April’s 52.7 and signalled the first decline in services activity since April 2025.

With the data offering both a slight upward revision and evidence of a downturn, Sterling was left struggling for direction.

Meanwhile, the Euro (EUR) also struggled to attract support on Wednesday after the Eurozone’s latest PMI figures pointed to ongoing weakness in the bloc’s private sector.

The final composite PMI for May was revised higher, rising from the preliminary estimate of 47.5 to 48.5.

However, the reading remained below the 50-point mark that separates growth from contraction, limiting any upside for the single currency.

As a result, while the upward revision helped cushion the Euro from sharper losses, the lacklustre data left the currency without a clear catalyst for gains.

Near-Term GBP/EUR Forecast: ECB and BoE Speeches In Focus

Looking ahead, a speech from European Central Bank (ECB) President Christine Lagarde could drive movement in the Euro on Thursday morning.

Should Lagarde signal that stubborn inflation may force the ECB to raise interest rates, the Euro could find some support.

However, any upside may be checked by the Eurozone’s latest retail sales figures. Economists expect April’s data to show a fourth consecutive monthly contraction, which could fuel fresh worries over consumer demand across the bloc.

Later in the session, Bank of England (BoE) Governor Andrew Bailey is also scheduled to speak.

Bailey has recently adopted a more cautious tone on interest rates, suggesting that policymakers may be willing to tolerate inflation overshooting targets for a time in order to protect the UK’s fragile economy.

Any similar remarks could leave the Pound on the defensive.

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TAGS: Pound Euro Forecasts