German industrial production rose 0.4% in April, matching forecasts, but failed to lift the Euro against the Pound ahead of the ECB decision.
The Euro held losses against the British Pound, trading near 0.8640 in early European hours, despite stronger-than-expected German industrial production data. Germany’s output rose 0.4% month-on-month in April, recovering from a 0.1% decline in March and aligning with market expectations. Year-on-year, production fell 0.5%, an improvement from March’s revised 3.4% drop.
The rebound in German data did little to support the Euro, as focus shifts to the European Central Bank’s interest rate decision on Thursday. Markets widely expect a 25 basis point hike, reflecting the ECB’s recent hawkish tone. Meanwhile, expectations for the Bank of England have shifted, with some now pricing in a potential 25 basis point increase before year-end, up from earlier cuts.
The Pound’s resilience comes as traders reassess monetary policy divergence between the UK and Eurozone, with attention on ECB President Christine Lagarde’s upcoming remarks.