The head of the Federal Reserve Jerome Powell will testify on the Semiannual Monetary Policy Report on Tuesday and Wednesday
British pound heads south to a minimum after the release of the report on UK inflation
On Wednesday, the British pound went down to a minimum of the trading session after the report informed that inflation in the United Kingdom in March headed south to a minimum for the last year, which reduces the chances of an interest rate lift by the Bank of England next month.
The currency pair GBP/USD went down 0.59% coming up with an outcome of 1.4204 after the previous value of about 1.4275.
On Wednesday, the National Statistical Office of Great Britain informed that on an annualized basis in March, inflation speeded down to about 2.5% after a 2.7% in February. It appears to be the minimum value for the last year, which turned out to be lower than the forecast of inflation growth by about 2.7%.
Core inflation speeded down year-on-year to up to 2.3% against the 2.4% growth in February as well as acceleration forecasts to 2.5%.
Inflation is currently slowing towards a target value of the Bank of England of about 2%. As a matter of fact, the probability of an increase in the interest rate in May seemed to have reduced, as some market experts have already pointed out.
Inflation data confirmed that the cost of living in the United Kingdom has gone down.
A report on Tuesday pointed out that the average wage level in the United Kingdom tacked on by approximately 2.8% for the three months to February. Thus, the growth of wages for the first time managed to surpass inflation of the previous year.
The British pound also went down versus the common currency. The currency pair EUR/GBP went up about 0.65% ending up with an outcome of 0.8714 versus 0.8659 before the publication of the inflation report.
The United States will publish the non-farm employment change, also known as non-farm payrolls (NFP) at 15:30 MT time on February 7.
The level of non-manufacturing PMI for the United States by the Institute of Supply Management will be published at 17:00 MT time on February 5.
The Federal Open Market Committee will publish its meeting minutes on February 19, at 21:00 MT time.
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