Forex: EUR/GBP drops overnight as Europe weighs

FXstreet.com (Barcelona) - Having steadily declined from yesterday's high at 0.8020, EURGBP has continued to sell over during the overnight session following continued lack of clarity over the Greek bailout situation following the Eurogroup meeting yesterday.

With European stocks opening sharply lower, EURGBP has plunged in sympathy at the opening bell, declining to where it currently trades at 0.7979, just above S2 support at 0.7972. Calendar wise, a busy session lies ahead following Spanish CPI came in marginally lower than expectations MoM at 0.8%/0.9%. Swiss Producer and Import Prices too disappointed MoM expectations at -0.1%/0.2%. Ahead we have Italian and Portuguese CPI at 09:00 GMT, followed by UK CPI at 09:30 GMT and the German and EU ZEW Survey at 10:00 GMT. The BoE is also expected to issue its Inflation Letter at some point during today's European session.

The analysts at Danske Bank see this pair as a sell from 0.8131 with a target of 0.7923 and a stop at 0.8081. Elsewhere European Equities are heavily down alongside commodities while critical Spanish and Italian yields are up but stable at the moment and worthy of monitoring.