GBP/USD Retreats After UK CPI

The GBP/USD pair experienced a sharp decline following the release of hotter-than-expected UK inflation data. This unexpected surge in inflation has heightened expectations of a less accommodative monetary policy stance from the Bank of England.

Unless the pair can reclaim the 1.2700 level, the bearish trend is likely to persist. A sustained break below 1.2600 could accelerate the decline towards the yearly low of 1.2299.

The GBP/USD pair is under significant pressure due to rising inflation concerns in the UK. Traders should remain cautious and monitor key technical levels for potential entry and exit points.

Technically; the pair has breached the crucial 200-day SMA, confirming a bearish trend. Immediate support lies at 1.2600, with further downside potential towards the May low of 1.2445. The RSI is trending towards oversold territory, indicating potential for a near-term rebound.