GBP/USD Price Nudges Higher on UK Inflation Uptick, Brexit Latest
UK Inflation, Brexit and Sterling (GBP) Price, Chart and Analysis:
- UK inflation ticks higher, but Sterling remains sanguine.
- Opposition to UK PM proroguing Parliament grows.
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The latest UK inflation release saw price pressures increase marginally in July, while house price growth was unchanged from the prior month.
According to the Office for National Statistics (ONS),the inflation rate increased slightly, with computer games, consoles and hotel prices rising more than they did last year. Conversely, air, international rail and sea fares did not rise by as much as 12 months ago. House price growth was unchanged overall with London annual growth again negative, for the 16th month in succession, while growth was strongest in Wales and the Midlands.
While the data remains important, the latest Brexit news continues to steer Sterling. On Tuesday, a Scottish judge fast-tracked a challenge by more than 70 MPs to stop UK PM Boris Johnson shutting down Parliament (proroguing) to prevent the House from blocking a no-deal Brexit. The case will be heard by September 6. In addition, the Speaker of the House, John Bercow, said that he would ‘fight with every breath in my body’ to stop the PM proroguing Parliament, although how he intends to do this, and the legality of the move currently remains vague.
GBPUSD trades around 1.2070, in the middle of this week’s range, with little to direct the pair. The US-China trade tariff news yesterday gave the US dollar a small boost, but it seems that markets are now firmly in holiday-mode and expected to stay that way until the end of the month.
GBPUSD Price Chart (November 2018 – August 14, 2019)
Retail traders are 76.9% net-long GBPUSD according to the latest IG Client Sentiment Data, a bearish contrarian indicator. However recent daily and weekly positional changes give us a stronger bearish contrarian bias.
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