The British pound traded higher against its main counterparts today as markets expected positive consumer price index data from the UK tomorrow. The British pound strengthened against its main peers despite the lack of any news events in the UK today, notwithstanding the passing of the Article 50 bill in the House of Commons on last week.
At the height of its rebound the British pound gained over 50 pips against its main competitor the US dollar although it had retraced some of its gains at the time of writing.
The main trigger behind the British pound’s recovery was the higher forecasted figures for the UK consumer price index and the core consumer price index, which are predicted to be at 1.9% and 1.7% respectively. The the core inflation figures are also expected to be closer to the Bank of England‘s target of 2%.
The pound was also affected by positive expectations of an increase in annual average weekly earnings for January that are expected to be at 2.8% for December. The retail sales for January are also expected to post a rebound of 0.7%.
The vote on the Brexit bill by the House of Lords is likely to impact the performance of the pound. News from the USA is also likely to affect the pound’s performance the US CPI is to be released on Wednesday.
The GBP/USD was trading at 1.2510 as at 18:19 GMT having opened the day’s session at 1.2481 and later hit highs of 1.2539 before retracing some of its gains. The EUR/GBP was trading at 0.8472 having opened the day trading at 0.8508.
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