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As softer US CPI data leads to a sharp decline in the US dollar, the GBP/USD pair has surged over 1.80% to trade around 1.2499, namely nearest the 1.2500 level, on the back of the recent US inflation data. October US inflation dropped the most in the last three months to 3.2%.
Lower than expected US CPI and core CPI numbers authorize less hawkish stance by the Fed.
According to the US Bureau of Labor Statistics, Core CPI, which excludes volatile items and is seen as a more stable inflation gauge, dipped a tenth and missed estimates. The US Dollar Index is plunging more than 1.40%, down at 104.13, and the US 10-year benchmark note rate is sinking more than 18 basis points, down at 4.45%.
On the UK front, the GBP/USD shrugged off a mixed employment report from Britain, which witnessed a slowdown in wages and added more jobs than the -198K contraction expected by analysts.
The GBP/USD is brisk of reclaiming the 1.2500 figure, despite the Bank of England’s (BoE) Chief Economist Huw Pill’s comments that the BoE would need to raise rates further.
