GBPUSD Price May Yet Drop More as UK Inflation Data, Brexit Sour Mood
GBP price, news and analysis:
- The GBPUSD price outlook remains poor as brief Brexit optimism Tuesday dissipates and the race to replace Theresa May as UK Prime Minister waits for the starting flag to be waved.
- Meanwhile, news of weaker-than-expected UK inflation data is adding to Sterling’s woes.
GBPUSD weakness may persist
GBPUSD continues to trade within the downward channel on the charts that has been in place for most of this month so far and could fall to 1.26 as the Brexit process continues to go nowhere. After an offer Tuesday by UK Prime Minister Theresa May of a Parliamentary vote on a second Brexit referendum, that gave Sterling a brief boost, failed to gain support, GBP dropped back again and continues to look weak.
As the runners and riders jostle for position at the starting line, waiting for the official starting flag to be waved in the race to replace May as Prime Minister, uncertainty is bound to persist – and so far GBPUSD has shown little sign of responding favorably to her likely fall.
GBPUSD Price Chart, Hourly Timeframe (May 3 – May 22, 2019)
Chart by IG (You can click on it for a larger image)
In the meantime, UK inflation data for April showed a smaller-than expected increase to 2.1% year/year from March’s 1.9%. That compares with the consensus forecast of 2.2%, although it was still the highest this year, pushed up by a rise in energy bills.
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--- Written by Martin Essex, Analyst and Editor
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.