The Euro appreciates for the second consecutive day to reach fresh three-month highs at 0.8875.The Pound losses ground weighed by grim UK economic perspectives and hopes of a slower BoE tightening.
EUR/GBP appreciates about 5.5% in 2022 with the Sterling hit by the UK’s political drama.
The Euro finally managed to pierce the 0.8860 resistance area on Friday, extending its rebound from session lows at 0.8820 to fresh three-month highs at 0.8870 so far. The common currency is taking advantage of a moderately weak Sterling on a sluggish pre-holiday session.
The pair has shrugged off the mild risk aversion on the back of concerns about the consequences of the strong COVID-19 outbreak in China and the escalating tensions in Ukraine, to appreciate for the second consecutive day.On the other hand, the Pound remains offered across the board, weighed by the grim economic perspectives in the UK and hopes that the Bank of England will slow down its monetary tightening path over the coming months.
The Sterling is about to close its worst year since 2016.The EUR/GBP is set to end the year with a 5.5% appreciation, favored by the broad-based pound weakness in 2022. The Sterling was hit hard by the political uncertainty during the last months of Boris Johnson’s mandate and Liz Truss’ tax reform fiasco.
Johnson’s successor’s Downing Street tax cut plan caused a historical Pound crash in October and prompted an intervention by the Bank of England to avert a credit crunch.The Pound has firmed up somewhat in the fourth quarter, as the election of Rishi Sunak calmed the markets although the negative economic outlook coupled with soaring inflation is keeping GBP buyers at bay.
EUR/USD clings to gains above 1.0650 on final trading day of 2022
EUR/USD has stretched higher toward 1.0700 during the European trading hours before retreating modestly. The renewed US Dollar weakness on the last trading day of the year seems to be helping the pair stay in positive territory amid a lack of fundamental drivers.
GBP/USD fluctuates in daily range slightly below 1.2050
GBP/USD is having a difficult time making a decisive move in either direction and moving sideways in a narrow channel slightly below 1.2050. Despite the cautious market mood, the US Dollar is struggling to find demand on Friday and helping the pair limit its losses.
Gold gains traction, climbs above $1,820
Gold price has gathered bullish momentum and advanced to a fresh daily high above $1,820 on Friday. With the US Dollar staying under constant selling pressure on the last trading day of 2022, XAU/USD remains on track to close the second straight week in positive territory.