British Inflation Continues Falling – CPI at 3.6%


The UK’s consumer price index rose at an annual rate of 3.6%. Early expectations stood on an annual rate of 3.6% after last month’s 4.2% pace.

GBP/USD weakened earlier after Britain got a credit rating warning from Moody’s, and as the joy regarding the Greek deal faded out. Yet just before the publication, it managed to recover.

RPI dropped to a pace of 3.9%, lower than 4.1% that was expected. Core CPI saw predictions of +2.7% and actually came out at 2.6%.

Pound/dollar now slides to 1.5725. The headline figure was in line with expectations, while the others were weaker.

A VAT increase was seen in January 2011, and this sent prices higher. Therefore, the annual figure this time omitted that rise.

The Monetary Policy Committee decided to expand the Asset Purchase Facility to 325 billion pounds last week, as inflation is dropping and unemployment is on the rise.

Tomorrow we will get fresh unemployment figures. For more on the pound, see the GBP/USD forecast.

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About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.


  1. thanks for all your article
    pls what is going on in usdjpy are the japanees govt implementing QE

  2. Thanks for your comment. The BOJ decided on more QE. This weakens the currency. In addition, they pledge an explicit inflation target of 1%. This means that they will continue printing to reach this goal. Together with weak growth reported yesterday, the yen certainly has reasons to fall.

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