The Pound Sterling (GBP) trades cautiously near a fresh three-month low around 1.2750 against the US Dollar (USD) in Wednesday’s London session. The GBP/USD pair faces pressure with investors focusing on the United States (US) (CPI) data for October, which will be published at 13:30 GMT. (DXY), which gauges the Greenback’s value against six major currencies, clings to gains at around 106.00, the highest level seen in more than six months., with the core – which excludes volatile food and energy prices – rising steadily by 3.3% year-on-year. The monthly headline and core CPI are estimated to have risen steadily by 0.2% and 0.3%, respectively.The inflation data isn’t expected to significantly impact market expectations for the Federal Reserve’s (Fed) likely monetary policy action in the December meeting unless there is a sharp divergence from consensus. Recent commentary from a majority of Fed officials indicated that they are confident about the disinflation trend remaining on track to the bank’s target of 2%.Still, Minneapolis President Neel Kashkari struck a cautious note on Tuesday at a Yahoo! Finance event. ” that might give us pause,” he said. Kashkari added that the monetary policy is “modestly restrictive right now,” and he expects economic growth to persist. When asked about the impact of President-elect Donald Trump’s policies on the inflation , Kashkari said: “The tariff is a one-time increase in prices, that’s not inflationary in itself.”President-elect Donald Trump has vowed to raise import tariffs by 10% and lower corporate taxes in his election campaign.According to the CME FedWatch tool, the probability for the Fed to reduce interest by 25 basis points (bps) to 4.25%-4.50% in December is 62%, down from 70% a week ago.
Daily digest market movers: Pound Sterling remains on backfoot against its major peers
Technical Analysis: Pound Sterling establishes 200-day EMA(Click on image to enlarge)The Pound Sterling wobbles above the three-month low near 1.2700 against the US Dollar. The GBP/USD weakened sharply on Tuesday, breaking below the 200-day Exponential Moving Average (EMA), which trades around 1.2860. The overall trend of turned broadly negative after price action fell below the lower boundary of the rising channel, which set a bearish reversal.A bearish momentum has kicked in with the 14-day Relative Strength Index (RSI) falling below 40.00.Looking down, the August low at 1.2665 will be a major cushion for Pound Sterling bulls. On the upside, the Cable will face resistance near the psychological figure of 1.3000.More By This Author:
