GBP/USD picks bids at 1.1500 on as UK inflation rate trims to 9.9% – by Sagar_Dua24 GBPUSD Inflation Fed BOE Employment
The price rise index has slipped lower but is still beyond the desired rate of UK central bank. The deadly duo of the higher inflation rate and Tuesday’s weaker Claimant Count Change data will continue to trigger more troubles for the. The UK Office for National Statistics reported an increment in the number of jobless benefits claims by 6.3k against the expectations of a decline by 9.2k. While the Unemployment Rate scaled down to 3.6% in relation to the forecasts and the prior release of 3.8%.
One good news, which delighted the UK households was the upbeat Average Hourly Earnings data. The earnings data improved dramatically to 5.2% vs. the estimates of 5.0% and the prior release of 4.7%. Forced higher payouts to the households due to soaring price pressures were unable to get offset by lower-valued paychecks. Now an increment in households’ earnings will support them to cater to soaring energy bills and food prices.
On Tuesday, the cable nosedived after the release of the elevated US inflation rate. The headline US CPI which inculcates oil and food prices while the calculation landed at 8.3%, higher than the expectations of 8.1%. While the core CPI surges to 6.3% vs. theof 6.1%. Federal Reserve policymakers are continuously making efforts to cool down the red-hot inflation. All efforts went in vain as price pressures have become more vulnerable now.
This has strengthened the odds of a third consecutive 75 basis points rate hike by the Fed in its September monetary policy meeting. A rate hike of 75 bps will scale up the borrowing rates to 3.00-3.25% and will dent the growth prospects. Going forward, the US Retail Sales data will be a key trigger. The economic data is not showing any sign of improvement in the overall demand.
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