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

UK Oct CPI Overview

The UK docket has the CPI report, which will be published later this session at 0930GMT. The consumer prices in the British economy are expected to tick higher to 3.1% in Oct y/y. While core figures, excluding volatile food and fuel costs, are also expected to accelerate slightly to 2.8% in the reported month.

On monthly basis, the consumer prices are expected to arrive at 0.2%, when compared to 0.3% seen in the month of September. 

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 60 pips in deviations up to 2 to -3, although in some cases, if notable enough, a deviation can fuel movements of up to 75 pips.

 How could affect GBP/USD?

On a positive print, we could see Cable attempt a bounce back towards 1.3130/35 10-DMA/ NY highs), beyond which 1.3150 resistance area (psychological levels) could be tested, opening doors towards the horizontal resistance near 1.3175 region.

Conversely, an unexpected drop in the CPI figures will cause GBP/USD pair to extend the downslide towards 1.3062 (weekly lows), below which a test of 1.3100 mark will be imminent.

Key notes

UK: Headline CPI likely to accelerate to 3.3% y/y in October - TDS

GBP/USD Forecast: likely to eye unfinished target of 1.30 on below-forecast UK CPI

About UK CPI

The Consumer Price Index released by the Office for National Statistics (ONS) 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).