GBP/USD slips to 1.2450 as UK CPI rises 1.7% y/y in August vs. 1.9% expected

UK CPI rises 1.7% y/y in August vs. 1.9% expected.
UK CPI arrives at +0.4% m/m in August vs. +0.5% expected.

Dhwani Mehta FXStreet

The UK Consumer Prices Index (CPI) 12-month rate came in at 1.7% in August, when compared to 2.1% booked in July while bettering expectations of a 1.9% print, the UK Office for National Statistics (ONS) reported on Wednesday.

Meanwhile, the core inflation gauge (excluding volatile food and energy items) arrived at 1.5% y/y last month versus 1.9% booked in July while matching the consensus forecast of 1.8%.

The monthly figures showed that the UK consumer prices arrived at +0.4% in August, beating +0.5% expectations and 0.0% last.

Main Points (via ONS):

“The largest downward contributions to the change in the CPIH 12-month rate between July and August 2019 came from a range of recreational and cultural goods and services (principally games, toys and hobbies, and cultural services), clothing and sea fares.

Rises in airfares resulted in the largest, offsetting, upward contribution to change.”

On a bigger-than-expected drop in the UK CPI numbers, the GBP/USD pair fell further to refresh daily lows of 1.2450, losing -0.40% on the day.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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