GBP/USD Daily Forecast – 17 February

Yesterday's session brought UK CPI and PPI figures. The Consumer Prices Index (CPI) rose by 0.3% in the year to January 2016, in line with market forecasts, compared with a 0.2% rise in the year to December 2015. This is the third consecutive month of small increases, with the rate in January 2016 being the same as it was in January 2015. The main contributors to the rise in the rate were motor fuels, and to a lesser extent food, alcoholic beverages and clothing. Air fare prices partially offset the rise in the rate, falling by more than they did a year ago. This followed a large increase in prices in December 2015.

GBP/USD Daily Forecast – 17 February

Sterling was initially pushed higher in the course of the session on Tuesday, but found area around 1.4520 level to be resistive enough in order for pair to pullback sharply to all the way below 1.43 handle. Focus of tomorrow's session will be on UK job figures. Pair is likely to find support around 1.42 handle, and 1.4150 handle in extension, as these were major resistive points in the past and resistance above 1.44 handle so this is where we would consider placing short-term selling bids. Read more...

UK CPI rose by 0.3% in January

The Consumer Prices Index (CPI) rose by 0.3% in the year to January 2016, in line with market forecasts, compared with a 0.2% rise in the year to December 2015. This is the third consecutive month of small increases, with the rate in January 2016 being the same as it was in January 2015. The main contributors to the rise in the rate were motor fuels, and to a lesser extent food, alcoholic beverages and clothing.  Air fare prices partially offset the rise in the rate, falling by more than they did a year ago. This followed a large increase in prices in December 2015.

GBP/USD Daily Forecast – 16 February

There were no major data releases from the UK on Monday. Britain's housing market has "hit the ground running" in 2016 said Rightmove, a property listings website, in its house price index for January. The average house price reached £299,287 after rising 2.9% over the month. Rightmove also said there was a 5% increase in the number of properties coming onto the market during January, and a 10% rise in the supply of typical first-time buyer homes, which have two bedrooms or fewer.

House prices rose sharply in recent years for a number of reasons. In some areas of the country, particularly London and the south east of England, there is a serious shortage of housing supply. Other areas were recovering from a low base after the financial crash, with property prices only reaching their pre-crisis peaks again in 2014. And a healing domestic economy, high employment and low interest rates have fueled demand for home purchases.

Focus of tomorrow's session will be on CPI and PPI figures. Analysts are expecting 0.1% incline in CPI and decrease by 1.2% in PPI Input. In the US session Empire State Manufacturing Index data will be published. Increase to -10.3 is predicted.

Figures to watch:

CPI/PPI (Tuesday 10:30)

Empire State Manufacturing Index (Tuesday 14:30)