EUR/GBP rebounds above 0.8450 ahead of Eurozone Industrial Production data

• EUR/GBP trades with a bullish bias around 0.8455 in Thursday’s early European session. 
• The weaker UK economic reports create a tailwind for the cross. 
• The lower bets on another interest rate cut from the ECB in July cap the pair’s downside. 

The EUR/GBP cross extends the recovery to 0.8455 during the early European session on Thursday. The cross bounced off the lowest level since August 2022 near 0.8418 as the stagnant UK monthly Gross Domestic Product (GDP) number and weaker Industrial Production data for April dragged the Pound Sterling (GBP) lower against the Euro (EUR). 

On Wednesday, published by the Office for National Statistics (ONS) showed that the UK economy stagnated in April after growing 0.4% in March. The figure was in line with the market expectations. Meanwhile, UK Industrial Production dropped  0.9% MoM in April from a 0.2% increase in March, worse than the estimation of -0.1%.  

On the Euro front, the hawkish cut from the European Central Bank (ECB) seems to underpin the shared currency as ECB  President Christine Lagarde cooled down expectations for another interest rate cut in July and preferred to wait for upcoming data. Later on Thursday, the Eurozone Industrial Production for April will be published, which is expected to rise 0.2% on a monthly basis from 0.6% in March. The weaker sign of the manufacturing sector in the Eurozone might weigh on the EUR and cap the upside for the EUR/GBP cross.