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Euro remains firm against British Pound after UK growth data

July 16, 2026

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EUR/GBP gains ground to around 0.8475 in Thursday’s early European session.
UK GDP grew by 0.1% MoM in May, as expected.
Oil-driven inflation concerns could prompt the BoE to maintain a hawkish stance.

The EUR/GBP cross holds positive ground near 0.8475 during the early European trading hours on Thursday. The British Pound (GBP) weakens against the Euro (EUR) following the UK economic data.

Data released by the Office for National Statistics (ONS) showed on Thursday that the UK economy expanded by 0.1% MoM in May, following a 0.1% decline reported in April. This figure came in line with the market expectations.

Meanwhile, the monthly Industrial Production fell by 0.5% in May, versus a 0.2% rise prior, below the consensus of -0.1%. Manufacturing Production increased by 0.1% MoM in May, compared to a rise of 0.5%, stronger than the forecast of -0.2%.

The mixed UK economic data have little to no impact on the British Pound. However, traders still ramp up their bets on rate hikes from the Bank of England (BoE) this year, given the expected impact on inflation from higher oil prices.

Money markets are fully pricing in a hike by the November policy meeting, with a second rate hike priced in by April 2027, according to Reuters.

On the Euro front, European Central Bank (ECB) President Christine Lagarde emphasized that the central bank remains strictly data-dependent. The official policy account explicitly noted that the June hike was neither a guaranteed sequence nor a guaranteed one-off move. On Wednesday, ECB Governing Council member Martin Kocher said that the central bank prepared to implement monetary policy measures whenever necessary.