Currency Analyst since 2010

GBP is beaten by inflation data

FXBAZOOKA.com - British pound got hit by the inflation data which came out even lower than expected: consumer prices in the UK gained only 0.5% in December (forecast: +0.7%; previous: +1.0%). This is the lowest rate of annual inflation since May 2000. The Bank of England’s Governor Mark Carney will be now obliged to write a letter to Finance Minister Osborne explaining why inflation is below the 1% threshold.

The continuing falling oil prices increase the negative pressure on GBP even more. It looks like inflation figures for January which will be released next month will be weak as well.

GBP/USD is trying to stabilize around 1.5100. Next support levels lie at 1.5055 and 1.5034. Resistance is at 1.5150 and 1.5200. The bears have clearly gained in power.

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