GBPUSD falls on UK inflation miss
The GBPUSD’s downwards momentum continues. This is on the back of an established mark-down phase, which is characterised by a bearish EMA formation. I.e. the green 5-day EMA is below the orange 13-day EMA, and the orange 13-day EMA is below the black 34-day EMA. Moreover, the RSI(9) is below 50 and is indicative of an underlying bearish momentum.
Today’s CPI y/y release came in at 2.4% which was less than the forecast of 2.5% in a period where energy prices are increasing. Moreover, testimony by Mark Carney yesterday was certainly less than inspiring, stating that UK hhouseholds are £9oo worse off because of Brexit. This certainly does not sound like an environment that is characterised by central bank hawkishness. As such cable is declining. Today’s FOMC minute’s release, if hawkish, will weigh further on GBPUSD.
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