GBP weaker on UK Inflation release
Daily Currency Update
GBP fell sharply by 0.35% against the US Dollar on Wednesday morning on the inflation data release from the UK.
The UK inflation report is set to have a significant influence on the Bank of England’s path forward on interest rates and impact the Pound valuation.
The official data released by the Office for National Statistics presented that the UK’s annual Consumer Price Index CPI showed a 6.7% higher reading in August, cooling off from a 6.8% rise in July. The expectations had been for a 7.1% increase.
Core CPI which excludes volatile food and energy, rose 6.2% year on year in the month, compared with a 6.9% jump in July while missing estimates of a 6.8% clip.
Meanwhile, the UK Consumer Price Index rebounded 0.3% month on month in August compared to the 0.7% estimates and the 0.4% contraction in July.
The UK Retail Price Index missed expectations in August and rose 0.6% month on month and 9.1% year on year.
The Bank of England has been expected to follow the European Central Bank and their stance, signaling the last in hikes this year after a 25-basis points bps rate increase on Thursday, while GBP is weaker this morning's inflation release the decision could indicate the next valuations of the pound against rival major currencies.
Key Movers
Today the US Federal Reserve will announce its Interest Rate Decision the Federal Reserve is widely expected to leave its rates unchanged at 5.25%-5.50% and signal a hike in November. Investors await the decision for further direction in the GBPUSD pair.Expected Ranges
- GBP/USD: 1.2346 - 1.2423 ▼
- GBP/EUR: 1.1552 - 1.1604 ▼
- GBP/AUD: 1.9261 - 1.9113 ▼
- EUR/USD: 1.0678 - 1.0718 ▼