GBPUSD Analysis – January-17-2024


The GBPUSD currency pair showed a moderate increase, reaching $1.26, following an unforeseen acceleration in the UK’s inflation rate last month. Surpassing the anticipated 3.8%, the inflation rate climbed to 4%. A significant factor contributing to this rise was implementing a new tobacco duty. This inflationary surge has sparked debates and concerns regarding the Bank of England’s potential monetary policy response. The markets are now estimating a 60% likelihood of an interest rate cut in May by the Bank of England as they react to this unexpected inflation data.

Simultaneously, recent labor market statistics have painted a mixed picture of the UK economy. Wage growth appears to be decelerating, which could impact consumer spending and economic growth. Furthermore, job vacancies have plummeted, reaching a low not seen in over two years. This decline in job openings might indicate a cooling labor market, which could have broader economic implications.

The upcoming retail sales data is highly anticipated to provide further insights into the UK’s economic performance. This data is crucial as retail sales are a key indicator of consumer confidence and spending, which are vital components of financial health. Analysts and policymakers will closely monitor this data to gauge the strength of the UK economy and inform future monetary policy decisions.

GBPUSD Analysis – January-17-2024

GBPUSD Analysis Daily Chart