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14 Aug 2013
Flash: GBP/USD in drivers seat after BoE – Investec
FXstreet.com (New York) - Recent UK data and events have certainty changed the outlook of the GBP/USD in the near-term, notes Jonathan Pryor, Corporate Treasurer at Investec.
Key quotes
On the PPI side, input prices rose by 1.1% on the month, in line with consensus, while factory gate inflation (based on output prices) nudged up to 2.1%. We do think that CPI inflation is now in a downtrend phase, but yesterday’s numbers were not a surprise and are unlikely to have much market impact.
“With the Bank of England Forecasting UK inflation to remain close to the 3% level in the near- term, yesterday’s data is unlikely to cause any deviation in Mark Carney’s plans to keep rates at low levels for the foreseeable future, which will obviously yield an effect on the GBP/USD.”
Key quotes
On the PPI side, input prices rose by 1.1% on the month, in line with consensus, while factory gate inflation (based on output prices) nudged up to 2.1%. We do think that CPI inflation is now in a downtrend phase, but yesterday’s numbers were not a surprise and are unlikely to have much market impact.
“With the Bank of England Forecasting UK inflation to remain close to the 3% level in the near- term, yesterday’s data is unlikely to cause any deviation in Mark Carney’s plans to keep rates at low levels for the foreseeable future, which will obviously yield an effect on the GBP/USD.”