GBPUSD falls back under 1.45 on softer UK inflation and ongoing concerns over possible “Brexit” dragging down GBP. UK core CPI dropped to 1.2% y/y in Jan (below 1.3% forecast) and RPI rose to 1.3% y/y but came in under forecast of 1.4%. Not enough to trigger a massive reaction in sterling immediately but enough to trigger a bout of selling in the morning that ultimately accelerated into the afternoon session with GBPUSD now trading 2 cents lower than this morning.
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GBPEUR bouncing strongly at the start of the week has also giving up its gains, failing to get through 1.30 resistances and falling back to 1.28 levels. Tomorrow we’ll see the release of UK unemployment data with 5% headline figure expected, an improvement from 5.1% reading previously – a disappointing figure will trigger more sterling weakness.
Latest FX news by Alastair Sweetman