GBPUSD sees slight rise as market anticipates UK CPI release

GBPUSD Analysis

Performance after Monday
Period	Pct	Chg	Momentum
Monday	0.15%	19 Pips
Week to-date	0.15%	19 Pips
March	2.83%	355.6 Pips

Upcoming key events (London Time)

Wed 07:00 AM GBP Consumer Prices Index (CPI) (12-mth)

What happened lately

In the United Kingdom, the upcoming release of the Consumer Prices Index (CPI) is scheduled for Wednesday at 07:00 AM, and it is considered a high-impact economic event. The CPI is a crucial indicator as it measures the changes in the price level of a basket of consumer goods and services purchased by households. This data provides insights into the inflationary pressures within the economy and can influence monetary policy decisions by the Bank of England. If the CPI figures show higher-than-expected inflation, it could lead to speculation about potential interest rate hikes, which in turn may strengthen the British pound.

The USD has been largely stable with no significant fluctuations reported recently. This steadiness implies that external factors related to the United States economy are likely playing a minimal role in the short-term movements of the GBPUSD pair. However, US economic data, geopolitical events, or Federal Reserve comments could still impact the pair, necessitating close observation by forex traders and analysts.

Given the slight rise of 0.15% in GBPUSD to 1.29300 on Monday and the current consolidation phase, the market seems to be awaiting more decisive data or events to influence its direction. The release of the UK CPI data is anticipated to be a potential market mover, as it could prompt speculation regarding the Bank of England’s future monetary policy path. If the inflation figures are higher than expected, traders may anticipate an increased likelihood of interest rate hikes, which would typically bolster the GBP. Conversely, lower-than-expected CPI could lead to a depreciation of the GBP as it may suggest a less aggressive stance on monetary tightening. As such, the GBPUSD pair remains in a critical watch zone ahead of the CPI release, which could dictate its short-term trajectory.

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What can we expect from GBPUSD today?

GBPUSD on Monday rose 0.15% to 1.29300. Price is below 9-Day EMA while Stochastic is falling.

Updated daily direction for GBPUSD looks mixed as the pair is likely to consolidate above 1.29111 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.29317 or trades above daily pivot 1.29214. Break above could target R1 at 1.29403. While to the downside, we are looking at 1.29111 (S1) and daily low of 1.29025 as support levels. GBPUSD need to break on either side to indicate a short-term bias. A break above 1.29317 may suggest continuation after recent positive movement.

For the week to-date, take note that GBPUSD is mixed as compared to the prior week.

Key levels to watch out:

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