US inflation data surpasses expectation
Friday 16 July, 2021
Daily Currency UpdateGBP - British PoundUK June CPI data released this morning came in over forecast at 2.5% vs. an expected 2.2%. We have seen an immediate response in the GBP/USD pair this morning. It is up 0.25% at the time of writing vs. earlier this morning.
Key MoversGBP/USD remained around the 1.38 level during yesterday’s session as it tried to fend off dollar strength. This came off the back of better-than-expected US CPI data. CPI increased by 0.9% in June up from May to 5.4%, beating the market expectation of 0.4%. This is the largest gain in 13 years, since June 2008. This fuelled market optimism that the Federal Reserve may change the pandemic-era stimulus sooner than expected. This strong US inflation data put pressure on the EUR/USD pair sending it under the 1.1800 mark. The currency pair could be restricted in its upside potential if the ECB maintain their wary monetary policy position. Further pressures to the currency pair came in the form of growing COVID-19 cases around the Eurozone.
- GBP/USD: 1.3840 - 1.3885 ▲
- GBP/EUR: 1.1735 - 1.1775 ▲
- EUR/USD: 1.1770 - 1.1815 ▼
- GBP/AUD: 1.1845 - 1.1875 ▼