GBP/USD holds steady below 1.2900 handle, moves little after UK CPI

   •  UK headline CPI fall 0.8% m/m; yearly rate eases to 1.8%.
   •  Mostly in-line core reading helped limit deeper losses.

The GBP/USD pair extended its intraday retracement slide and slipped further below the 1.2900 handle post-UK inflation figures, albeit lacked strong follow-through.

The pair failed to capitalize on the early uptick and started retreating from a session high level of 1.2923 amid some renewed US Dollar buying interest. The British Pound lost some additional ground following the release of dismal UK data, showing that the headline CPI declined 0.8% m/m in January.

Adding to this, the yearly rate also fell short of expectations and eased to 1.8% y/y during the reported period. Meanwhile, the core reading held steady at 1.9% y/y rate and seemed to be the only factor that helped limit deeper losses, at least for the time being.

Moreover, investors also seemed reluctant to place any aggressive bets and preferred to wait for fresh Brexit updates from the upcoming parliament debate, scheduled to take place on Thursday - February 14. 

Technical levels to watch