-1687341516.png)
GBP Under Pressure
GBPUSD has come under fresh selling pressure today as the latest round of UK inflation data failed to inspire optimism. UK CPI in May was seen printing 8.7% on the headline reading above the 8.4% the market was looking for. Core CPI meanwhile, rose to 7.1% from 6.8% prior. With both readings showing a disappointing level of stickiness GBP has sold off today on fresh fears over the health of the UK economy.
With mortgage rates already at multi-decade highs of 6%, this latest round of inflation data suggests that, not only will the BOE be forced to hike rates again this month, the forward guidance is likely to be firmly hawkish also. Growth fears for the UK appear to have now become a more central driver for GBP than BOE expectations. Looking ahead, the focus tomorrow will be on the forward guidance the BOE gives with market’s expecting a firmly hawkish delivery from the bank.
Technical Views
GBPUSD
The rally in GBPUSD saw the market trading up to fresh highs around the 1.28 mark. However, price is now softening in line with weakening momentum studies readings. While 1.2659 holds as support, the focus is on a further push higher towards 1.2992. Below here, however, 1.2437 comes into view as the next support to note.
.png)
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.