Title: GBP/USD picks bids at 1.1500 as UK inflation rate trims to 9.9%
September 14, 2022 02:06 AM ET
The GBP/USD pair is regaining bids around 1.1500 after the release of UK inflation data. The headline inflation rate was cut to 9.9% from the forecast of 10.2% and the previous release of 10.1%. The core consumer price index (CPI) remained in line with expectations at 6.3%.
The price inflation index slipped to the bottom but remains above the rate desired by the British central bank. The deadly duo of higher inflation and Tuesday's weaker claimant count data will continue to create challenges for the Bank of England (BOE). The UK's Office for National Statistics reported an increase in jobless claims of 6.3k, against expectations of a 9.2k drop. While the unemployment rate fell to 3.6% compared to forecasts and the previous publication of 3.8%,
One piece of good news, which pleased British households, was the increase in average hourly earnings.
Earnings data improved dramatically to 5.2% from the forecast of 5.0% and the previous release of 4.7%. The forced increase in household payments due to soaring prices could not be offset by the decline in wages. An increase in household income will allow them to cope with soaring energy bills and food prices.
On Tuesday, cable plunged after the release of the high U.S. inflation rate. The headline CPI in the United States was 8.3 percent, compared to 8.1 percent expected, while the core CPI was 6.3 percent, compared to 6.1 percent expected. Fed policymakers are constantly trying to cool down hot inflation. All efforts have been in vain as price pressures have become more vulnerable now.