Forex: GBP/USD – Bouncing between highs and lows ahead of US CPI data

on Jul 16, 2013
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iNVEZZ.com Tuesday July 16th: At this later point in European trading, sterling has shed the losses accumulated earlier in the session, when the pair fell on the back of weak UK inflation data. Right after that release, the pound fell against the dollar to $1.5045 – an intraday low so far.

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Ahead of the NY opening though, the pair recovered strongly to 1.5121, with the dollar awaiting the US CPI updates, though after the session got under way the USD strengthened again, to 1.5074.
The UK consumer inflation rate y/y, released earlier today, came out at less than economists had forecast at 2.9 percent in June from 2.7 percent in May, and well ahead of the Bank of England’s benchmark of two percent. On a monthly basis, the CPI fell by 0.2 percent in June, after climbing 0.2 percent in May and versus forecasts for a 0.1 percent drop. Year-on-year Core CPI grew by 2.3 percent, up from 2.2 percent in May and in line with forecasts.

The BOE will publish the minutes of its most recent policy meeting at 09:30 BST tomorrow. At the same time, the Office for National Statistics will release labour market numbers which economists are picking to show a fall in June’s jobless claims. The unemployment rate is forecast to stay unchanged at 7.8 percent in the quarter through May.
Today’s economic updates in the US begin with the Consumer Price Index, scheduled for right now, at 13:30 BST, and to be followed at 14.00 BST by the Redbook Index, US Net TIC Flows and industrial production.

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