UK Feb CPI Overview
The UK docket has the CPI report, which will be published later this session at 9.30GMT. The consumer prices in the British economy are expected to tick 2.1% higher in February y/y, after having booked a 1.8% reading in January. While core figures, excluding volatile food and fuel costs, are also expected to accelerate 1.8% in the reported month versus 1.6% previous.
On monthly basis, the consumer prices are expected to rebound to +0.5% in the resorted month versus -0.5% last.
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 better CPI print, we could see cable extending its rebound towards 1.24 handle. On the other hand, should the data disappoint on yearly basis, we could see the GBP/USD pair dropping to test key support near 1.2330 region.
The reaction on the data may remain limited as investors may look forward to BOE Governor Carney’s speech scheduled later in the EU session.
About UK CPI
The Consumer Price Index released by the 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 purchase 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).
- R3 1.2407
- R2 1.2401
- R1 1.2393
- PP 1.2387
- S1 1.2378
- S2 1.2373
- S3 1.2364
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