The British pound fell against the much stronger dollar, extending yesterday’s losses amid disappointing UK Inflation figures attributed to massive discounts and lockdown measures. The GBP/USD currency pair’s decline was also driven by negative investor sentiment as markets anticipate the disruption of Britain’s vaccination drive due to supply interruptions.
The GBP/USD currency pair fell from a high of 1.3742 during the Asian market to a low of 1.3673 in the early London session and was within this range at the time of writing.
The currency pair headed lower, driven by the surging greenback that kept rising despite falling US Treasury yields. The release of downbeat UK consumer price index data for February drove the pair to its daily lows. According to the Office for National Statistics, the UK’s inflation rose 0.1% in February, missing consensus estimates of 0.5%. The release of the mixed UK PPI report for February had a muted impact on the pair. The upbeat Markit/CIPS UK Manufacturing and Services PMI prints, which were way better than expected, also had a minimal impact on the pound. Prime Minister Boris Johnson‘s comments that the UK’s selfish actions were responsible for its vaccination programme’s success did not help the pound.
The cable failed to capitalise on the downbeat US Durable Goods Orders report for February by the Census Bureau. The pair clawed back some of its losses after the Markit US services and manufacturing PMIs missed analysts expectations.
The currency pair’s future performance is likely to be affected by the BoE Governor Andrew Bailey’s speech tomorrow and US dollar dynamics.
The GBP/USD currency pair was trading at 1.3711 at 17:54 GMT, having dropped from a high of 1.3742. The GBP/JPY currency pair was trading at 149.16 after rising from a low of 148.52.
© SimonMugo for Forex News, 2021. |
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Post tags: Boris Johnson, CPI, Durable Goods Orders, GBP/JPY, GBP/USD, Inflation, Investor Sentiment, Markit/CIPS, Office for National Statistics, Pound, PPI, United Kingdom
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