The British Consumer Price Index dropped from 2.5% to 2.2% in September, as expected. This is almost at the perfect 2% target, and well within the 1-3% range.Â
Almost all the other inflation figures came out as expected. GBP/USD trades at 1.6090, sliding from a move above 1.61 seen earlier.
Core CPI remained at 2.1%, exactly as expected. The Retail Price Index (RPI), slid from 2.9% to 2.6%. The official HPI ticked lower to 1.8%, a bit below the 1.9% level that was expected.
Producer prices were also published at the same time: PPI Input surprised by dropping 0.2% (0% was expected) and PPI Output surprised with a rise of 0.5% (0.3% was estimated).
With these convenient inflation levels, the Bank of England is free to decide on more monetary easing, depending on the state of the economy. More quantitative easing is on the cards.
GBP/USD is trading between 1.60 and 1.63 for a long time. For more specific levels and upcoming events, see the GBPUSD forecast.
