News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bullish
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Bearish
More View more
Notice

BoE Chief Econimist (Hawk) is to Step Down From BoE After June Meeting

Real Time News
  • 🇰🇷 Unemployment Rate (MAR) Actual: 3.9% Previous: 4% https://www.dailyfx.com/economic-calendar#2021-04-13
  • RT @RiskReversal: This week on @macrosetup from @IG_US, @GuyAdami & I take a look under the hood of the $SPX & $NDX at all time highs as mi…
  • Heads Up:🇰🇷 Unemployment Rate (MAR) due at 23:00 GMT (15min) Previous: 4% https://www.dailyfx.com/economic-calendar#2021-04-13
  • Hello Traders! Apologies for the last-minute change in scheduling, but I will be hosting my biweekly webinar an hour earlier than normal Please join the session below, starting in about 20 minutes I will be covering the #Yen and Swiss #Franc around retail trader positioning! https://t.co/i1ctUMp221
  • Please join @ddubrovskyFX at 19:00 EST/23:00 GMT for a webinar on what other traders' buy/sell bets say about price trends. Register here: https://t.co/Bb3CTCTm44 https://t.co/UxS5mmoG2K
  • Top event risk for the next 24 hours according to what I think generates actual market movement: Earnings (GM, JPM, BBBY); CB speak from Powell, Lagarde, Kuroda; US Senate Foreign Relations Committee meeting on Chinese policy. Missing anything important?
  • The USD was flat against SGD, THB, IDR and PHP as falling Treasury yields offset potential gains from Emerging Market Stock declines. Ahead, all eyes are on Chinese GDP, US CPI, Powell and the MAS. Get your $USD market update from @ddubrovskyFX here:https://t.co/qwileJ3OUX https://t.co/i1U5Frptnn
  • RT @BrendanFaganFx: Grab SPAC Set to Take Markets by Storm, After Commanding $40 Billion Valuation Link: https://www.dailyfx.com/forex/market_alert/2021/04/13/Grab-SPAC-Set-to-Take-Markets-by-Storm-After-Commanding-40-Billion-Valuation.html
  • Gold remains in a range just above the March lows / technical support at 1682/89 with price drifting towards the upper bounds. Get your $XAUUSD market update from @MBForex here:https://t.co/4VJsyYuuyj https://t.co/IzeSIJCKmy
  • Coinbase direct listing reference price set at $250 - BBG $COIN
GBP/USD to Eye Fresh July Highs on Strong U.K. CPI- 1.7200 in Focus

GBP/USD to Eye Fresh July Highs on Strong U.K. CPI- 1.7200 in Focus

David Song, Strategist

- U.K. Consumer Price Index (CPI) to Increase for Second-Time in 2014.

- Core Rate of Inflation to Rise for the Third-Time This Year.

Trading the News: U.K. Consumer Price Index

A pickup in the U.K.’s Consumer Price Index (CPI) may generate fresh monthly highs in the GBP/USD as it fuels expectations for a Bank of England (BoE) rate hike later this year.

What’s Expected:

GBP/USD U.K. CPI

Click Here for the DailyFX Calendar

Why Is This Event Important:

The bullish sentiment surrounding the British Pound should gather pace in the second-half of the year as the BoE looks normalize monetary policy sooner rather than later, and the fundamental developments coming out of the region may continue to prop up interest rate expectations as a growing number of central bank officials adopt a more hawkish tone for inflation.

For Real-Time Updates and Potential Trade Setups on the British Pound, sign up for DailyFX on Demand

Expectations: Bullish Argument/Scenario

Release

Expected

Actual

NISER GDP Estimate (JUN)

--

0.9%

Jobless Claims Change (MAY)

-25.0K

-27.4K

ILO Unemployment Rate (3M) (APR)

6.7%

6.6%

Expectations for a faster recovery paired with the ongoing improvement in the labor market may prompt a stronger-than-expected CPI print, and a marked pickup in the headline reading for inflation may generate a bullish reaction in the GBP/USD as it boosts interest rate expectations.

Risk: Bearish Argument/Scenario

Release

Expected

Actual

Mortgage Approvals (MAY)

61.8K

61.7K

Retail Sales inc. Auto (MoM) (MAY)

-0.5%

-0.5%

Average Weekly Earnings inc. Bonus (3Moy) (APR)

1.2%

0.7%

However, subdued wages along with the slowdown in private sector credit may drag on consumer prices, and a dismal inflation report may spur a larger correction in the GBP/USD as it dampens bets of seeing a rate hike later this year.

Read More:

British Pound May Fall as Soft Inflation Data Undermines BOE Bets

Weekly Price & Time: USD/JPY Inching Towards the Lows of the Year

How To Trade This Event Risk(Video)

Bullish GBP Trade: U.K. Inflation Climbs to 1.6% or Higher

  • Need green, five-minute candle following the release to consider a long British Pound trade
  • If market reaction favors buying sterling, go long GBP/USD with two separate position
  • Set stop at the near-by swing low/reasonable distance from entry; look for at least 1:1 risk-to-reward
  • Move stop to entry on remaining position once initial target is hit, set reasonable limit

Bearish GBP Trade: CPI Falls Short of Market Forecast

  • Need red, five-minute candle to favor a short GBP/USD trade
  • Implement same setup as the bullish British Pound trade, just in reverse

Potential Price Targets For The Release

GBP/USD Daily

GBP/USD Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • Topside Targets Remain Favorable as Price & RSI Retain Bullish Trend
  • Interim Resistance: 1.7200 Pivot to 1.7220 (100.0% expansion)
  • Interim Support: 1.6890 (38.2% expansion) to 1.6900 (61.8% expansion)

Impact that the U.K. CPI report has had on GBP during the last release

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

MAY 2014

06/17/2014 8:30 GMT

1.7%

1.5%

-20

+27

May 2014 U.K. Consumer Price Index

GBP/USD Chart

U.K. consumer prices slowed to an annualized 1.5% in May from 1.8% the month prior, while the core rate of inflation narrowed to 1.6% during the same period after expanding 2.0% in April, which marked the fastest pace of growth since August 2013. The British Pound struggled to hold its ground following the weaker-than-expected CPI print, with the GBP/USD slipping back below the 1.6950 region, but the sterling regained its footing during the North American trade, with the pair ending the day at 1.6990.

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

Trade Alongsidethe DailyFX Team on DailyFX on Demand

Looking to use the DailyFX Trade Signals LIVE? Check out Mirror Trader.

New to FX? Watch this Video

Join us to discuss the outlook for the major currencies on the DailyFXForums

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES