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EUR/GBP – high 0.8579

FXstreet.com (London) - EUR/GBP has enjoyed a Sterling sell off while Retail Sales came in at +0.5% in April vrs +2.0% - not a good result for sterling.

BoE said today that Six members of the Monetary Policy Committee voted to keep quantitative easing at 375 billion pounds ($568 billion) this month. King, Miles and Fisher stuck to a campaign to increase stimulus by 25 billion pounds. According to the minutes, “There was tentative evidence that measures of medium-term inflation expectations were becoming more sensitive to short-term news in inflation…Financial markets were not expecting further asset purchases at this meeting and might, at the margin, reassess the committee’s tolerance of elevated inflation should additional stimulus be injected.”

Analyst, Axel Rudolph, Commerzbank said 'The outlook has changed to short term bullish now that it has overcome resistance made up of the 2013 downtrend line and 55 day moving average at 0.8486/0.8516. They also said that the next upside target is the 0.8559 April 9 and 10 high''.

Further risk to the upside could be expected if volatility arrives a little later today, when the dollar could come under some pressure, pining onto the words of Bernanke, and if there are signs that the language with regards to tapering their QE programme came too soon, the Euro may benefit from that which may further aid the EUR/GBP cross. To the downside, support is noted at 0.8500 and 0.8460

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