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. See our updated Privacy Policy here.

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
More View more
Real Time News
  • $SPX Daily. . . Before & After #FOMC . . . https://t.co/yXrFqH6mHx https://t.co/pT33kiYiXg
  • A big move in the US 10-year Treasury yield following yesterday's FOMC meeting. Resistance around 1.38% was broken easily, with the 10Y settling around 1.43% $ZN $ZB https://t.co/k6eht1IkXG
  • The Bitcoin plunge turned off near-term downtrend support and while we could see more recovery in the short-run, the risk remains lower while within this formation. Get your $btc market update from @MBForex here:https://t.co/Vf94gjIqhx https://t.co/nqhU8Ve5mx
  • The Central Bank of the Republic of Turkey ended its monetary tightening cycle will a surprise 100-bps rate cut on Thursday. Get your market update from @CVecchioFX here:https://t.co/zbhiBmUKiO https://t.co/AYxFnqB7ou
  • Risk on sentiment has buoyed AUD/USD, with the cross trading back above 0.7300 $AUDUSD https://t.co/Bx5MOuIgDb
  • The morning after the Fed has produced some robust moves in markets, with both stocks and bonds putting in a notable leap. Get your market update from @JStanleyFX here:https://t.co/7sQ4d63PLM https://t.co/vfrKuhDUce
  • Gold trades back down to $1,750 as US real yields tick higher $XAUUSD #Gold https://t.co/yMtnYCBsaa
  • Canadian Dollar Price Forecast: USD/CAD Snaps Back to Key Support https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2021/09/23/Canadian-Dollar-Price-Forecast-USD-CAD-USDCAD-Snaps-Back-to-Key-Support-Zone.html $USDCAD https://t.co/BGiAkAI3zy
  • RT @BrendanFaganFx: 77 counterparties take $1.352 trillion at Fed's fixed-rate reverse repo $USD $DXY https://t.co/kjecsXvpVU
  • EUR/USD attempts to halt a five day decline as the Federal Reserve sticks to the sidelines. Get your market update from @DavidJSong here:https://t.co/ig9bGLj35i https://t.co/YPksmNdJLR
Sterling Falls as UK Inflation Comes in Weaker Than Expected

Sterling Falls as UK Inflation Comes in Weaker Than Expected

Martin Essex, MSTA, Analyst

Talking Points

- UK inflation stayed at 2.6% in July rather than rising to 2.7% as economists had predicted.

- That makes a near-term tightening of UK monetary policy less likely and has weakened the British Pound.

Check out our new Trading Guides for a longer-term view on GBP: they’re free and have been updated for the third quarter of 2017

The British Pound fell back in European trading Tuesday after news that the headline CPI measure of UK inflation stayed at 2.6% year/year in July rather than increasing to 2.7% as economists had forecast. Core CPI was also unchanged, at 2.4% rather than rising to 2.5% as predicted.

The news should calm nerves on the Bank of England’s monetary policy and make a near-term tightening of UK monetary policy less necessary. While inflation remains above the Bank’s 2% target, the UK economy has not been growing strongly – making a rates decision difficult.

In the markets, GBP/USD eased back to its lowest since July 13, while EUR/GBP strengthened.

Chart: GBP/USD Five-Minute Timeframe (August 15, 2017)

Sterling Falls as UK Inflation Comes in Weaker Than Expected

Chart by IG

Elsewhere, the FTSE 100 rose 0.37% to 7,381 as the inverse correlation between the currency and London stocks remained in place.

The positive news on consumer prices was echoed in the data on producer prices, which suggest that there is less inflation in the pipeline. The input producer price index grew by 6.5% in the 12 months to July 2017, down from 10.0% in the 12 months to June 2017. The output producer price index grew by 3.2% in the 12 months to July 2017, down from 3.3% in the 12 months to June 2017.

--- Written by Martin Essex, Analyst and Editor

To contact Martin, email him at martin.essex@ig.com

Follow Martin on Twitter @MartinSEssex

For help to trade profitably, check out the IG Client Sentiment data

Join analysts Christopher Vecchio, Nick Cawley and Martin Essex for the European Desk Roundtable at 1000 GMT. You can sign up here

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

DISCLOSURES