The British pound gained minor ground vis-Ã -vis the U.S. dollar today as cable tested offers around the US$ 1.9530 level and was supported around the $1.9400 figure. Technically, todayâ€™s intraday high was right around the 23.6% retracement of the move from $1.9955 to $1.9385. Many data were released in the U.K. today. First, headline output prices were up 1.0% m/m in January, the highest monthly increase since January 1995, and input prices were up 2.6% m/m. Traders await the release of consumer price inflation data tomorrow with many forecasts calling for an annualized 2.3% gain. Bank of Englandâ€™s quarterly inflation report will be released on Wednesday. Short sterling futures are currently pricing in about 100bps of additional monetary easing from the central bank. Core output prices were up 1.1% m/m and 3.1% y/y, the highest annual rate since January 1996. Second, the December global goods deficit trade deficit narrowed to -₤7.6 billion from -₤7.9 billion in November. Third, the DCLG measure of house price inflation receded to 9.1% in December from 9.7% in November. Cable bids are cited around the US$ 1.9260 level. The euro weakened vis-Ã -vis the British pound as the single currency tested bids around the ₤0.7440 level and was capped around the ₤0.7505 level.
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