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GBP was shunted lower over the European morning today as the latest UK inflation data was weaker than expected. The headline reading came in at 2.4% year on year over September, down from the prior rate of 2.7% in August and below the market’s consensus forecast of 2.6 Core inflation was down also with the September reading printing 1.9%, down from the prior 2.1% reading and below the market forecast of 2%.
Food Was The Main Drag
Explaining the moves, the Office for National Statistics said “Food was the main downward pull on inflation as last year’s September price rises failed to reappear, while ferry prices dropped after their surprisingly high summer peak. However, it wasn’t all one-way traffic with energy suppliers pushing up their prices.”
Consumers Breathe A Sigh of Relief
While GBP bulls poorly received the news, UK consumers will be happy given domestic wage growth this week printed a ten year high of 3.1%. For the first time since the Brexit referendu...
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