GBP/USD breaches 1.3030 post-UK CPI, fresh 2018 lows

Cable breaks below the key 1.3040 area on UK CPI
The pair trades in levels last seen in September 2017 near 1.3020.
UK’s CPI came in flat MoM in June, up 2.4% YoY.

Pablo Piovano FXStreet

The British Pound met further selling pressure on Wednesday and is now dragging GBP/USD to print fresh 2018 lows in the 1.3030/20 band, levels last traded in September 2017.

GBP/USD weaker on UK data

Cable tumbled further after UK’s inflation figures tracked by the CPI came in below expectations for the month of June. In fact headline consumer prices rose at an annualized 2.4% over the last twelve months and came in flat on a monthly basis.

In addition, prices stripping food and energy costs also rose below estimates 1.9% YoY.

GBP is also deriving further downside pressure as the recently published inflation figures could pour cold water over expectations of a rate hike by the Bank of England at its August meeting.

In the meantime, the pair in trading in fresh 10-month lows in the 1.3030/20 band, down for the second straight session and opening the door for a potential test of the psychological support at 1.3000 the figure.

GBP/USD levels to consider

As of writing, the pair is losing 0.66% at 1.3024 and a break below 1.3011 (low Jul.18) would open the door to 1.3000 (psychological level) and finally 1.2771 (monthly low Aug.25 2017). On the flip side, the next hurdle lines up at 1.3201 (21-day sma) followed by 1.3207 (10-day sma) and then 1.3297 (high Jul.17).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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