UK inflation Data
- UK’s inflation data will be released today and the UK headline rate is expected to remain at 3% for November on a yearly basis. At a component level of the headline CPI rate, food costs are expected to have moved higher while tobacco and fuel prices increases may have not been picked up. Other components of the CPI rate have mixed trends. Also, UK’s core CPI rate and the RPI rate for November are to be released today and expectations are for both rates to remain at previous levels, at 2.7% and 4% respectively. It should be noted that should the forecasted figures meet the actual ones, the rate would remain above BoE’s target of 2%, which would increase the pressure on BoE.
- GBP/USD rose and broke the 1.3400 (R1) level during the Asian morning yesterday and fell thereafter, only to surrender any gains it had previously posted. The pair continued trading lower but still above the support level of 1.3300 (S1). Despite the drop he pair did not break the upward trend it had since the beginning of October 2016. Should the bulls take the driver’s seat, cable could break the 1.3400 resistance level and aim for the 1.3455 zone, while should there a release of weak inflation data data the pair could break the 1.3300 (S1) hurdle and test the 1.33260 (S2) level.
As for today’s other economic data
- We get Sweden’s CPI rate for November, which is expected to remain unchanged at 1.7% on a yearly basis. We also get from Germany the ZEW economic sentiment report and the ZEW current conditions report both expected to drop somewhat. From the US economy final PPI for October will be released which is expected to tick up. Both the Eurozone’s ZEW reports and US PPI data could affect the EUR/USD.
- EUR/USD rose yesterday during the Asian and European day only to surrender most of its gains later on without breaking the 1.1820 (R1) resistance level nor the 1.1725 (S1) support level. The pair continued to trade in a sideways manner since the 22nd of November. Should the bulls take the reins we the pair could break the 1.1820 resistance level and test for the 1.1880 zone. Should the bears take the driver’s seat the pair could break the 1.1725 (S1) support level and aim for the for the 1.1680 (S2) support territory.
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Support: 1.1725 (S1), 1.1680 (S2), 1.1550 (S3)
Resistance: 1.1820 (R1), 1.1880 (R2), 1.1960 (R3)
Support: 1.3300 (S1), 1.3260 (S2), 1.3080 (S3)
Resistance: 1.3400 (R1), 1.3455 (R2), 1.3550 (R3)