GBP/USD tumbles below 1.2260 on poor UK data

The GBP/USD pair has pared its modest recovery and has slipped below intraday’s low at 1.2257 on weak UK data. In the early Tokyo session, the asset displayed some exhaustion in the downtrend, however, the greenback bulls have got regained their dominance as the UK’S National Statistics has reported vulnerable UK data.

The Gross Domestic Product (GDP) has slipped to -0.3% against the expectation of 0.2%. Also, the annual Manufacturing Production figure has tumbled to 0.5 vs. 1.8% expected. However, the Industrial Production data has jumped to 0.7% from the estimates of 0.5% on annual basis.

The pound bulls have remained in the grip of bears on solid performance by the US dollar index (DXY). The DXY is oscillating around 104.50 after a juggernaut rally as higher US Inflation has bolstered the odds of a 75 basis point (bps) interest rate hike by the Federal Reserve (Fed) on Monday. The US agency has reported the annual US Consumer Price Index (CPI) figure at 8.6%, much higher than the estimates and the prior print of 8.3%.

The US labor agency also reported upbeat Nonfarm Payrolls (NFP), which has provided more liberty to the Fed to tighten their policy.

Also, the Bank of England (BOE) will announce its monetary policy on Thursday. The BOE could elevate its interest rates further amid soaring price pressures in the UK economy.  Advancing oil and commodity prices have pushed the inflation figure to a 40-year high of 9%. Considering the pace of inflation in the UK economy, it would be fit to state that the price pressures could soar to a two-digit figure.