The British pound today rallied to new yearly highs against the US dollar after the release of headline UK inflation data, which beat expectations, early in the European session. The stronger US dollar, as tracked by the US Dollar Index, could not derail the pound’s strong rally even as US treasury yields rallied higher.
The GBP/USD currency pair rallied by over 120 points from its daily lows at the height of its rally, but had retraced some of its gains at the time of writing.
The British pound rallied against the US dollar and other major currencies after the release of UK inflation data for the month of August by the Office for National Statistics. The headline CPI data beat expectations by coming in at 2.9% versus the expected 2.8%. The core CPI also surpassed market consensus as it was recorded at 2.7% as compared to the market estimate of 2.5%. The higher CPI figures fueled speculations that the Bank of England might take a more hawkish stance at its monetary policy meeting on Thursday.
The US dollar was decidedly weaker against the pound during the European session despite a rally in the US treasury bond yields. The release of the US JOLTS job openings data by the Bureau of Labor Statistics early in the American session boosted the greenback slightly against other currencies.
The currency pair’s future performance is likely to be affected by the release of UK jobless claims data and US MBA mortgage applications, both scheduled for tomorrow.
The GBP/USD currency pair was trading at 1.3275 as at 15:30 GMT having rallied from a daily low of 1.3161 earlier today. The GBP/JPY pair was trading at 146.04 having rallied from a low of 143.99.
If you have any questions, comments or opinions regarding the Great Britain Pound,
feel free to post them using the commentary form below.
