The British Pound is trading higher following the release of UK inflation figures for September. ING economists analyze the outlook for the British pound.
The slight surprise in the CPI is not enough for a rate hike in November
UK inflation figures for September were slightly higher than expected. The headline CPI grew 6.7% year-on-year as in August, while the core CPI slowed marginally from 6.2% to 6.1%. We believe that, despite slightly beating consensus, there is probably nothing in this inflation report that will push the Bank of England into a further rate hike in November.
EUR/GBP could correct slightly lower due to the repricing of Bank of England rate expectations, but is likely to rise ahead of the Bank of England meeting as we expect the central bank to remain unchanged .
Source: Fx Street
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