UK CPI in line with expectations, 2019 growth downgraded - Scotiabank

Ross J Burland FXStreet

Analysts at Scotiabank explained that the UK CPI rose 3.0% y/y in Dec, down a tenth from 3.1% in Nov, in line with expectations.

Key Quotes:

"Core inflation dipped a tenth as well to 2.5% but that was a little better than forecast (for 2.6%).

Government house price data suggest that the modest lift to prices nationally in the past few months is extending (+5.1% y/y, down slightly from an upwardly revised +5.4%) while London house price growth remains soft (+2.3%)."

"UK forecasters expect the UK economy to growth 1.6% this year and revised the 2019 outlook down slightly to 1.4%, according to Bloomberg.

The GBP rose modestly against the softer EUR earlier and is trading a little more defensively against the stronger USD."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

EUR/USD extends slide toward 1.1800 on renewed USD strength

EUR/USD extends its daily slide and trades at a fresh weekly low below 1.1850 in the second half of the day on Tuesday. Renewed US Dollar strength, combined with a softer risk tone keep the pair undermined alongside downbeat German ZEW sentiment readings for February.

GBP/USD falls below 1.3550, pressured by weak UK jobs report

GBP/USD remains under heavy bearish pressure and falls toward 1.3500 on Tuesday. The UK employment data highlighted worsening labor market conditions, bolstering bets for a BoE interest rate cut next month and making it difficult for Pound Sterling to stay resilient against its peers.

Gold recovers modestly, stays deep in red below $4,950

Gold (XAU/USD) stages a rebound but remains deep in negative territory below $4,950 after touching its weakest level in over a week near $4,850 earlier in the day. Renewed US Dollar strength makes it difficult for XAU/USD to gather recovery momentum despite the risk-averse market atmosphere.

Crypto Today: Bitcoin, Ethereum, XRP upside looks limited amid deteriorating retail demand

The cryptocurrency market extends weakness with major coins including Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) trading in sideways price action at the time of writing on Tuesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.