When are the UK CPIs and how could they affect GBP/USD?


The UK July CPIs Overview

The cost of living in the UK as represented by the consumer price index (CPI) is due later on Wednesday at 0830 GMT.

The headline CPI inflation is expected to arrive at -0.1% inter-month in July while the annualized figure is seen lower at 1.9%. The core inflation rate that excludes volatile food and energy items is likely to have steadied at 1.8% last month.

Deviation impact on GBP/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 15 and 80 pips in deviations up to 2 to -3, although in some cases, if notable enough, a deviation can fuel movements of up to 120 pips.

How could it affect GBP/USD?

At the press time, GBP/USD looks to extend the bounce from the Asian session lows of 1.2046 as the bulls fight for control near 1.2060 region. A bigger-than-expected decrease in the UK price pressures could knock-off the pound back towards the multi-month lows of 1.2016 vs. the greenback.

“From a technical perspective, Although prices remain below 23.6% Fibonacci retracement of latest declines, GBP/USD holds firm above two-day-old support-line as it trades near 1.2055 ahead of the UK CPI release. Also supporting the odds of upside is 12-bar moving average convergence and divergence (MACD) that is slowly inching closer to positive territory. In doing so, the quote can run-up beyond 23.6% Fibonacci retracement level of 1.2061 while targeting near-term descending trend-line, at 1.2080. Should there be increased rise above 1.2080, Monday’s high around 1.2107 and 61.8% Fibonacci retracement of 1.2136 can become buyers’ favorites. If at all sellers take over, 1.2015 and 1.2000 can be their aims prior to looking at the 2017 low near 1.1987 and 2016 bottom near 1.1800,” FXStreet’s Anil Panchal notes.

Key Notes

UK: Core CPI to hold steady at 1.7% y/y in July - TDS

Forex Today: Trade reprieve provides relief, German recession fears grow, UK inflation eyed

GBP Futures: further decline appears likely

About the UK CPI

The Consumer Price Index released by the Office for National Statistics is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services. The purchasing power of GBP is dragged down by inflation. The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally, a high reading is seen as positive (or bullish) for the GBP, while a low reading is seen as negative (or Bearish).

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD drops below 1.11 amid upbeat US data, trade concerns

EUR/USD is trading below 1.11 after robust US housing figures and solid consumer sentiment figures were published. Earlier, the common currency suffered from the concerns of new US tariffs on the EU.

EUR/USD News

GBP/USD down 100 pips after UK retail sales badly disappoint, amid USD strength

GBP/USD has plunged below 1.3050 after UK retail sales badly disappointed with a fall of 0.6% in December, on top of downward revisions. Odds of a BOE cut have risen.

GBP/USD News

Crypto market hyperspace mode On

The secondary actors of the crypto-sphere awaken and rally hard. Leading coins battle with greater resistance at the gates of a full bullish market. The only risk is an over-shoot, but that sentiment remains neutral.

Read more

Gold looks to close week flat below $1560

The XAU/USD pair climbed to a fresh daily high of $1560 in the early trading hours of the American session but struggled to preserve its momentum.

Gold News

USD/JPY: Losing bullish momentum but retaining gains

Chinese encouraging data kept markets in risk-on mode at the beginning of the day. The US January Michigan Consumer Sentiment Index is seen at 99.3, matching December figure. USD/JPY holding at the upper end of its weekly range could correct lower.

USD/JPY News

Forex MAJORS

Cryptocurrencies

Signatures