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The Pound Sterling stays strong near Tuesday’s high of 1.2450 against the US Dollar ahead of the US CPI data for January. Fed’s Powell stated that the central bank is in no rush to cut interest rates. The UK economy is expected to have contracted by 0.1% in the last quarter of 2024. The Pound Sterling (GBP) clings to gains near 1.2450 against the US Dollar (USD) in Wednesday’s European session. The GBP/USD pair exhibits strength ahead of the United States (US) Consumer Price Index (CPI) data for January, which will be published at 13:30 GMT.  Economists expect the annual core CPI – which excludes volatile food and energy prices – to have grown at a slower pace of 3.1%, compared to a 3.2% increase in December. In the same period, the headline CPI inflation is estimated to have remained steady at 2.9%. The month-on-month headline and core CPI are expected to have risen by 0.3%. Market participants will pay close attention to US inflation data, which will influence speculation about how long the Federal Reserve (Fed) will keep interest rates steady in the range of 4.25%-4.50%. Fed Chair Jerome Powell said on the first day of his two-day testimony before the US Congress on Tuesday that the central bank is in “no hurry to cut interest rates”, given resilient economic growth and sticky inflationary pressures. Powell argued that reducing policy restraint “too fast or too much” could “hinder progress on inflation”.  Ahead of the US inflation data, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades slightly higher near 108.00.  Daily digest market movers: Pound Sterling gains despite growing concerns over UK demand outlook The Pound Sterling trades higher against its major peers on Wednesday. However, the outlook of the British economy is…

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Filed under: News - @ February 12, 2025 8:24 am