Inflation in the UK slows down to 2.8 % on an annual basis in February, compared to 2.9 %
- The UK’s annual consumer price index increased by 2.8 % in February 2.9 %.
- British inflation jumped to 0.4 % mom in February compared to 0.5 % forecast.
- GBP/USD has less than 1.2950 losses after CPI inflation data in the UK.
The UK Consumer Prices (UK) increased by 2.8 % on an annual basis (YOY) in February, after an acceleration of 3.0 % in January, according to data issued by the National Statistical Office (ONS) on Wednesday.
The markets expected 2.9 % growth in the reported period. Reading has been much higher than the goal of England (BOE) by 2 %.
The basic consumer price index (except for food and volatile energy) increased by an annual rate of 3.5 % in the same period, compared to a 3.7 % jump in January, which is less than 3.6 % market expectations.
Inflation in services remained at 5 % year on an annual basis in February.
Meanwhile, the monthly inflation in CPI in the UK was recovered to 0.4 % in February from -0.1 % in January. The markets are estimated to read 0.5 %.
GBP/USD reaction to CPI inflation data in the United Kingdom
CPI data in the UK practices moderate pressure on sterlingSend GBP/USD 0.15 % less per day less than 1.2950, as of writing.
British pound price today
The table below shows the percentage of change in the British pound (GBP) against the main currencies listed today. The British pound was the weakest against the New Zealand dollar.
| US dollar | euro | GBP | JPY | CAD | Aud | Nzd | Chf | |
|---|---|---|---|---|---|---|---|---|
| US dollar | 0.07 % | 0.16 % | 0.39 % | -11 % | -0.25 % | -0.36 % | 0.13 % | |
| euro | -07 % | 0.09 % | 0.29 % | -18 % | -0.31 % | -0.46 % | 0.06 % | |
| GBP | -16 % | -0.09 % | 0.23 % | -0.27 % | -0.40 % | -52 % | -0.00 % | |
| JPY | -0.39 % | -0.29 % | -0.23 % | -0.50 % | -67 % | -0.76 % | -0.25 % | |
| CAD | 0.11 % | 0.18 % | 0.27 % | 0.50 % | -11 % | -0.25 % | 0.28 % | |
| Aud | 0.25 % | 0.31 % | 0.40 % | 0.67 % | 0.11 % | -0.12 % | 0.39 % | |
| Nzd | 0.36 % | 0.46 % | 0.52 % | 0.76 % | 0.25 % | 0.12 % | 0.51 % | |
| Chf | -0.13 % | -06 % | 0.00 % | 0.25 % | -0.28 % | -0.39 % | -51 % |
The heat map shows the percentage changes in the main currencies against each other. The basic currency is chosen from the left column, while the quotation currency is chosen from the top row. For example, if you choose the British pound from the left column and move along the horizontal line to the US dollar, the percentage offered in the box will represent the GBP (Base)/USD (quotation).
This section was published below at 03:15 GMT as an inspection of inflation data at the UK Consumer Index (CPI).
- The UK National Statistics Office will issue consumer price index data in February on Wednesday.
- The UK’s annual title is scheduled to be reduced and the basic CPI enlarged in February.
- CPI data in the UK can affect the direction of the pound sterling and interest rates in the Bank of England.
The UK National Statistics Office (UK) (ONS) will publish the highly expected consumer price index data (CPI) for February on Wednesday at 07:00 GMT.
The Sterling (GBP) can suffer from severe fluctuations after a CPI report in the United Kingdom, as it is likely to change the market expectations to reduce future interest rates of England Bank (BOE).
What do you expect from the inflation report in the next UK?
The UK’s consumer price index is expected to increase by 2.9 % on an annual basis (YOY) in February, after 3 % growth in January.
Reading is expected to remain far from BOE goal by 2.0 %.
CPI, which excludes energy, food, alcohol, and tobacco, is expected to be a little less 3.6 % (YO) in February, a decrease of 3.7 % in January.
According to the Bloomberg Survey of Economists, official data is expected to show that the service enlargement is likely to facilitate 4.9 % in February after jumping to 5 % in January.
Meanwhile, the British monthly consumer price index is expected to increase by 0.5 % in the same period, compared to the previous decrease of 0.1 %.
By inspecting inflation data in the UK, TD securities noticed: “The inflation is scheduled to cool down a little, with the address down to 2.8 % (consensus: 2.9 %; 3.0 % before). We also expect the basic and services to come in numbers less than 3.6 % Yi (in advance: for the preferences of the Monetary Policy Committee (MPC).”
How will the UK consumer price index report affect GBP/USD?
At the monetary policy meeting earlier this month, the Bank of England (Bank of England) retained 4.5 % on Thursday, which calls for caution against expectations that they will reduce its next few prices amid the increasing uncertainty for the United Kingdom and global economies.
“However, the 8-1 voting division to stay waiting was a noisy surprise and an escalating amendment to the expectations of the UK’s prices.
Therefore, an emerging surprise for the main inflation data and the basic enlargement to reaffirm the wise approach at the Bank of England and increase the bets for lower price cuts this year. In such a case, the bullish trend is expected to resume the pound of pound, and the GBP/USD will be lifted again towards the 1.3050 barrier. On the contrary, the most softened inflation readings are likely to reduce economic concerns in the UK, to revive expectations for BOE price discounts and expand GBP/USD correction of its highest level for four months.
Any reaction to the UK’s inflation report is likely to be short -term, given the statement of the next British spring budget, scheduled for later on Wednesday.
Dhwani Mehta, the main analyst of the Asian session in FXSTREET, offers a brief artistic look of the pione And for the day, for the day, for the day, for the day, for the day, and for the day, there are 100-, play and serve as the back wind of the husband. “
“However, the husband needs to accept higher than a threshold of 1.3000 to start a continuous upward trend at the highest level in November 2024 at 1.3048. The following relevant resistance is compatible at the 1.3100 level. Sell pressure, which may lead to a 1.2750 psychological level test.”
Common questions about inflation
Inflation measures an increase in the price of a representative basket for goods and services. The main inflation is usually expressed as a change in percentage on a month on a monthly (illiterate) basis on an annual (annual) basis. Basic inflation excludes more volatile elements such as food and fuel that can fluctuate due to geopolitical and seasonal factors. The basic inflation is the number that economists focus on and is the level targeted by central banks, which are assigned to maintaining inflation at a controlled level, and is usually about 2 %.
Consumer price index (CPI) measures changing commodity and services basket prices over a period of time. It is usually expressed as changing a percentage on a month basis on a monthly (illiterate) basis and on an annual basis (YOY). Core CPI is the number targeted by central banks as it excludes food and flying fuel inputs. When the basic consumer price index rises above 2 %, it usually leads to high interest rates and vice versa when less than 2 % is less than 2 %. Since high interest rates are positive for the currency, high inflation usually leads to a stronger currency. The opposite is true when the inflation falls.
Although it may seem intuitive, high inflation in a country pays the value of its currency and vice versa to reduce inflation. This is because the central bank usually raises interest rates to combat higher inflation, which attracts more global capital flows from investors looking for a profitable place to enter their money.
In the past, gold was the asset investors turned in times of high inflation because it maintained its value, and while investors will often buy gold for its safe properties in times of extremist turmoil in the market, this is not the case most of the time. This is because when inflation is high, central banks will put interest rates to combat them. The highest interest rates are negative for gold because it increases the costs of maintaining gold in assets that bear interest or placing money in the calculation of cash deposits. On the other hand, low inflation tends to be positive for gold because it leads to low interest rates, making the bright metal a more applicable investment alternative.
