Euro / Pound exchange rate gains hit resistance, but upward bias favoured ahead of UK Industrial Production data

The euro pound exchange rate is flat at 10:15 on Monday morning; EUR-GBP is at 0.8619, significantly higher than seen this time last week.

NB: The above quote is taken from the wholesale spot market - your bank will affix their own discretionary spread to the above figures. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering you more currency. Please find out more here.

Where to next for the euro pound exchange rate?

The euro, like most other major currencies, has taken a massive chunk out of sterling over the past two sessions and remains in favour.

However, Luc Luyet at MIG Bank says EUR/GBP may have hit resistance:

"EUR/GBP has broken the resistance at 0.8599 and is challenging the strong resistance at 0.8637 (17/04/2013 high). A short-term bullish bias is favoured as long as the hourly support at 0.8598 (intraday low) holds. Another support lies at 0.8561 (intraday low)."

Richard Driver at Caxton FX says:

"The pound continues to trade around the €1.16 benchmark and the main UK economic data for the week comes tomorrow. This pair will likely remain under pressure."

Euro supported by trade data

The Euro lost ground against a broadly stronger US Dollar during the Asian session but was little changed against the Pound.

The immediate outlook for the euro pound exchange rate

The next key driver for the euro pound exchange rate is tomorrow's industrial production numbers.

Consensus forecasts for UK Industrial Production (Year on Year for May) are for a decline of -1.5 pct against last month's reading of -0.6 pct.

Any positive surprises here could underpin the British pound against the euro.