Trading United Kingdom CPI News

With the Bank of England focusing on the 2% inflation target, we had the United Kingdom unemployment and earnings data released on Tuesday 15th October, overall the unemployment data was above forecast with earnings and unemployment reached 4% however earnings on a bigger picture is declining which is what the BoE are focusing on. This supports rate cuts in November.

This UK CPI report could swing the Bank of England in either direction depending on the data, we could see further upside to the GBP if CPI comes out hotter which could make the Bank of England hold off to any rate cuts in November and be more data dependant.

That being said, if we get weaker UK CPI report this will support a rate cut in November along with earnings coming in slightly lower.

The Bank of England held interest rates on its last meeting while being data dependant, however this stance changed two weeks ago when Bank of England came out and said it could be open to aggressive rate cuts subject to data and the economy.

If we see a weaker print across the board for United Kingdom CPI this continues the support for a further rate cut in November. We would expect to see weaker GBP and yields.

If we see a stronger print across the board for United Kingdom CPI. We would expect to see stronger GBP and yields.