Strategy Video: Inflation Data May Tempt GBPUSD Reversal
• A round of UK inflation data due at 8:30 GMT represents one of the key fundamental drivers this week
• The sterling is still pricing in heavy speculation of a near-term BoE rate hike
• Should inflation data reinforce or undermine the market's rate expectations, the Pound is ready to react
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On an otherwise light data week, we are heading into one of the top potential volatility catalysts for the period: UK CPI. Interest rate expectations behind the pound have soared on the belief that the Bank of England will be pushed to incur its first rate hike well before the Fed and most of the other major central banks. That belief was reinforced with last week's quartelry report, but the timing and severity was not. Policy officials and traders are likely to see their convictions changed on this key price data. What should we look for and what trades are best suited for the different outcomes? We discuss that in today's Strategy Video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.