Pound Rises On Strong U.K. Inflation Data
17 Januar 2024 - 6:54AM
RTTF2
The British pound strengthened against other major currencies in
the European session on Wednesday, after U.K. consumer price
inflation picked up unexpectedly in December on alcohol and tobacco
prices.
Data from the Office for National Statistics showed that the
consumer price index rose 4.0 percent on a yearly basis, slightly
faster than November's 3.9 percent increase. The rate was forecast
to ease to 3.8 percent.
The inflation rate increased for the first time since February
2023. Nonetheless, the ONS said the annual rate in December 2023
was the second lowest since September 2021.
Month-on-month, the CPI gained 0.4 percent, offsetting the 0.2
percent decrease a month ago. Prices were expected to climb 0.2
percent.
Another data from the ONS showed that output prices rose for the
first time in three months in December. Prices gained 0.1 percent
annually, reversing a 0.1 percent fall in November. On a monthly
basis, output prices slid 0.6 percent after staying flat a month
ago.
The annual fall in input prices deepened to 2.8 percent in
December from 2.7 percent in November. On a monthly basis, input
prices fell 1.2 percent, which was the largest fall since June
2023. This follows a revised 0.4 percent fall in November.
In the Asian trading today, the pound showed mixed trading
against its major rivals. While the pound fell against the U.S.
dollar, it held steady against the euro, the Swiss franc and the
yen.
In the European trading now, the pound rose to more than a
1-month high of 0.8578 against the euro and more than a 1-1/2-month
high of 187.33 against the yen, from early highs of 0.8619 and
185.88, respectively. If the pound extends its uptrend, it is
likely to find resistance around 0.84 against the euro and 189.00
against the yen.
Against the Swiss franc, the pound climbed to nearly a 1-month
high of 1.0934 from an early high of 1.0869. The pound may test
resistance near the 1.10 region.
Moving away from an early more than a 1-month low of 1.2597
against the U.S. dollar, the pound edged up to 1.2677. On the
upside, 1.28 is seen as the next resistance level for the
pound.
Looking ahead, U.S. MBA mortgage approvals data, Canada PPI and
raw material prices, both for December, U.S. retail sales data,
U.S. export and import prices, and industrial production, all for
December, U.S. business inventories for November, U.S. NAHB housing
market index for January and U.S. Fed Redbook report are set to be
published in the New York session.
At 9:00 am ET, Federal Reserve Vice Chair for Supervision
Michael Barr will speak on "Cyber Risk" before the 2nd Annual
Massachusetts Institute of Technology/Federal Reserve System
Conference on Measuring Cyber Risk in the Financial Services
Sector, in Cambridge, Massachusetts, U.S.
At the same time, Federal Reserve Board Governor Michelle Bowman
will participate in discussion, "The Path Forward for Bank Capital
Reform," before the U.S. Chamber of Commerce Protect Main Street
Lending Event, in Washington D.C, U.S.
At 10:15 am ET, ECB President Christine Lagarde speak at 'How to
Trust Economics' event at the World Economic Forum held in Davos,
Switzerland.
At 3:00 pm ET, Federal Reserve Bank of New York President John
Williams will give opening remarks before hybrid event, "An Economy
that Works for All: Measurement Matters," at the Federal Reserve
Bank of New York.
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