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Breaking News: Pound Bid After Core Inflation Beat, 50bps Secured?

January 18, 2023

Via: DailyFX

The British pound received support this morning after a mixed bag of inflation data. Headline inflation in the UK declined in line with expectations to 10.5% (see economic calendar below) while beat estimates likely due to labor shortages. The core read which excludes food and energy from the calculation highlights the tight labor market conditions seen in yesterday’s UK employment numbers while the recent drop in the price of energy has contributed to the decline in the headline figure. In addition, as cited in the ONS report, the primary headline deflationary sectors were “transport (particularly motor fuels), clothing and footwear, and recreation and culture, with rising prices in restaurants and hotels, and food and non-alcoholic beverages.”

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