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Forex Today: UK Inflation, Pound Drop

By Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.

Positive bank results and speculation over AI advances lift major US stock indices to fresh long-term high prices.

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  1. UK CPI (inflation) data released yesterday showed a stronger than expected fall in the annualized rate, from 8.7% to 7.9%. This led to slightly more dovish expectations from the Bank of England on rate hikes and saw the Pound drop accordingly yesterday, although the move was nothing out of the ordinary.
  2. US stock markets saw prices advance to new 1-year highs in the NASDAQ 100 Index and the S&P 500 Index yesterday before mostly giving up the gains by the end of the day. Trend traders will be attracted to being long of these indices now.
  3. In the Forex market, the US Dollar has made a small advance over the past dayHowever, the Asian session has seen the strongest major currency as the Australian Dollar while the British Pound has been the weakest. This puts the GBP/USD and AUD/USD currency pairs in focus.
  4. The price of Wheat rose sharply yesterday, with futures ending the day more than 8% higher, after Russia threatened to target Ukrainian wheat exports by ship.
  5. There was a release yesterday of Australian Unemployment data which came in better than expected, with enough new jobs created to keep the unemployment rate at 3.5%.
  6. There will be a release today of US Unemployment Claims data, which is expected to be basically unchanged from last month.
Adam Lemon
About Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.

 

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