The Pound Sterling came under pressure after inflation data showed an unexpectedly greater decline than analysts had predicted. The Office of National Statistics reported that CPI in August was at 1.7%, below the 1.9% that had been called for and the 2.1% reading of the previous period. On the whole, inflation prices were down, in general, with core CPI down to1.5% and producer price index at -0.8% from 0.9% in July. The retail price index was unexpectedly improved at 0.8% in August (month-over-month), up from 0.0% in July.
The GBP/USD was trading lower at $1.2464, a loss of 0.2617% at 6:07 am in London. The pair has ranged from a low of $1.24383 to a high of $1.25121 in today’s session. The EUR/GBP was higher at 0.8862 Pence, up 0.087% and off the earlier high of 0.88820 Pence.
Outlook to BoE Decision
Markets will look ahead to this week’s policy decision from the Bank of England, which is set for Thursday. While analysts don’t foresee the central bank willing to make any changes to interest rates and its asset purchase scheme right now, they believe Mark Carney, the BoE governor, will prudently wait for any major upheaval after the Brexit deadline has passed.