UK pound stands still as CPI is in line with expectations

On Wednesday, the British pound kept having rather an uneventful trading week. The currency pair GBP/USD hit 1.3378 adding 0.04% on the day.

British CPI has been sticking with 2.4% for a second straight month, which is in line with expectations. As for another major inflation gauge, PPI Input, it managed to ascend by 2.8%, beating the estimate of about 1.7%.

Meanwhile, in the United States inflation reports turned out to be upbeat. The Producer Price Index tacked on to about 0.5%, which is quite above the estimate of 0.1%. It marked the highest revenue since April last year. Core PPI went up to 0.3%, beating the forecast of 0.2%.

The key US financial institution is anticipated to have rates lifted by a quarter-point. Moreover, it’s supposed to come with a rate statement. On Thursday, retail sales in Great Britain and the United States will be unveiled. American unemployment claims will be uncovered on Thursday too.

Traders pay much attention to the Fed or to be exact, it’s 2-day policy gathering that burst out on Wednesday. The Federal Reserve is widely anticipated to have rates raised to a range 1.75%- 2.0%. Apparently, the odds of a quarter-point move kept to 96%, as the CME Group unveiled. In spite of the fact a rate lift has been priced in by the financial markets, this considerable move could spur the evergreen buck against its counterparts.

Market participants are going to pay much attention to the language of the interest rate statement and also to the dot-plot predictions, searching for any clues as for rate lifts in the second half of this year. The key US bank is currently projecting up to three interest rate lifts in 2018, although a strong economy and also soaring inflation have spurred rumors that the Federal Reserve could have rates raised four times this year.

In Great Britain, wage surge keeps lagging behind inflation, affecting consumer spending.