June 20, 2012
"I get knocked out, but I get up again. You're never gonna keep me down," sang the pound yesterday as it managed to bounce back up after a weak U.K. CPI release. GBP/USD dipped to a low of 1.5615 then closed at 1.5731 while GBP/JPY ended the day at 124.20.
U.K. annual CPI figures for May came in weaker than expected as the headline reading landed at 2.8% while the core version of the report showed a 2.2% increase. Analysts were expecting the headline CPI to stay at 3.0% and the core CPI to print a 2.3% rise. With subdued inflationary pressures in the U.K., many are now speculating that the BOE has enough room to conduct another round of easing measures in their next policy statement. Based on recent economic data from the U.K., it does look like their country could use more stimulus!
Today, the U.K. claimant count change is set for release and the report is expected to show a 3.1K drop in claimants for May. A larger than expected decline would be positive for the pound while an increase in joblessness could force pound pairs to return their recent gains. Make sure you keep an eye out for that release at 8:30 am GMT.
Also due today are the minutes of the latest monetary policy meeting of the BOE. This should shed light on why the central bank decided to keep rates on hold during their previous statement and could contain hints about their future monetary policy moves.
"The only cable I watch is the pound baby."