GBP/USD within range near 1.4050 post-UK CPI
- Cable keeps the rally intact above 1.40 despite weak CPI.
- UK’s CPI rose below expectations at 2.7% on a yearly basis.
- UK’s jobs report and the BoE meeting next of relevance.
The rally in the Sterling remains well and sound so far on Tuesday and is now taking GBP/USD to the 1.4040/50 band in the wake of the release of UK’s inflation figures for the month of February.
GBP/USD bid in spite of weak CPI
Cable remains bid despite topday’s lackluster results from inflation figures in the UK economy. In fact, consumer prices tracked by the CPI rose at annualized 2.7% (vs. 2.8% forecasted) and 0.4% inter-month during February (vs. 0.5% expected).
In addition, consumer prices stripping food and energy costs rose 2.4% over the last twelve months, also coming in below initial estimates.
In the meantime, spot is up for the third session in a row and extending the recent breakout of the critical resistance line (now support line) off 2018 tops. The move appears to have opened a potential visit to the mid-1.4300s, always on the back of rising optimism in response to the breakthrough in the EU-UK Brexit negotiations.
GBP/USD levels to consider
As of writing, the pair is gaining 0.15% at 1.4045 facing the next hurdle at 1.4088 (high Mar.19) seconded by 1.4146 (high Feb.16) and then 1.4280 (high Feb.2). On the flip side, a break below 1.3934 (10-day sma) would aim for 1.3886 (low Mar.16) and finally 1.3782 (low Mar.8).
