EUR/GBP posts modest gains to near 0.8350, eyes on German, Eurozone GDP data

• EUR/GBP strengthens to near 0.8340 in Tuesday's early European session. 
• ECB's Wunsch said it is premature to discuss December policy decision. 
• BoE is likely to cut its rate by a quarter-point in the November meeting to 4.75%, according to a Reuters poll. 

The EUR/GBP cross trades in positive territory around 0.8340 on Tuesday during the early European session. The comments from the European Central Bank (ECB) policymaker Pierre Wunsch lift the Euro (EUR) against the Pound Sterling (GBP). Investors await the preliminary Gross Domestic Product (GDP) data for the third quarter from Germany and the Eurozone, which are due on Wednesday. 

ECB officials are divided on the necessity of a large reduction. On Monday, the ECB policymaker and Belgian central bank chief Pierre Wunsch noted that there is no urgency for the central bank to cut interest rates quicker and it could even live with a small. The less dovish comments provide some support for the shared currency. Meanwhile, ECB Vice President Luis de Guindos said on Monday that the central bank has made significant progress in bringing down inflation but can't declare victory yet. 

Nonetheless, money markets are still pricing in nearly 50% odds of the ECB rate reductions by half a percentage point in the December meeting. The GDP numbers on Wednesday could offer some hints about the health of the German and Eurozone economies. The weaker-than-expected outcome could increase the likelihood of the ECB rate cuts in December and might drag the EUR lower. 

On the other hand, the expectation that the Bank of England's (BoE) rate-cutting cycle might be slower than in the Eurozone could help limit the GBP's losses. According to a Reuters poll, economists expect the BoE to cut its Bank Rate by a quarter-point on November 7 to 4.75%, but a near-two-thirds majority anticipates no move in December.