Soggy inflation data sees Pound sellers return 18 July
GBPUSD posting lows of 1.3019 from 1.3080 upon the data release which in turn followed a sharp retreat from 1.3126, highs not seen since September last year.
I have long said here that I don't expect rate hikes anytime soon and this latest release throws a bit of sand back in the face of the MPC hawkish talk.
By their own admission in the last quarterly inflation report the BOE suggested that inflation would peak quicker than originally f/cast so now the question is have we seen the top or not?
Probably not but with softer energy prices and a firmer pound then we can't be too far off, and there's the real concerns I've expressed previously and again in today's preview re wages, disposable income and household debt.
Currently 1.3028 and EURGBP 0.8847 we'll expect support into 1.3000 and supply between 1.3050-60. EURGBP sellers between 0.8850-60 and 0.8880 with demand/support into 0.8820, then 0.8780-00.
