Yahoo Finance GBP/USD Corrects on Account of Bad CPI Data
The pound is being continued to be bogged down by the weak data that is incoming from the UK and even yesterday, we saw more of the same which has pulled down the GBPUSD and put the bulls under pressure. The bullish momentum that was generated in the markets over the last few days has now dissipated and it remains to be seen how the further data is going to push the pair.
GBPUSD Below 1.42
The pound has been struggling through higher despite the various issues and uncertainties dogging it and it had managed to make some solid progress over the past couple of weeks due to the fact that the Brexit process has been progressing smoothly and the BOE sounding as hawkish as ever. But we have been mentioning of how the incoming data has not tended to support the cause of the bulls and we saw more of the same yesterday as the CPI data came in weaker than was expected.
This continues the trend of weak data from the UK that we have been seeing over the last few weeks and puts a lot of pressure on the pound as it has led to doubts that the UK economy is feeling the pressure from the Brexit process. If this is going to be the situation when the process is still underway, the economy could come under even more pressure if a favorable deal is not struck during the Brexit negotiations. This uncertainty and risk is expected to bog down the pound in the short term.
Looking ahead to the rest of the day, we do not have any major economic data or news from the US but we have the retail sales data from the UK and if this piece of data also come in weak, then we should see the support region around 1.4080 come under pressure in the short term as the pair trades below 1.42 as of this writing.
This article was originally posted on FX Empire
