All eyes are on whether the pound will rebound ahead of the UK CPI release

All eyes are on whether the pound will rebound ahead of the UK CPI release

17.01.2024

Yesterday, the three major U.S. stock indices all fell, resulting in a market environment characterized by falling stock prices, rising interest rates, and lower oil prices.WTI crude oil briefly fell to $71.50. It is currently trading around $72.10. Natural gas, meanwhile, fell 9% to $2.80. All five major precious metals declined, with palladium seeing the sharpest drop, falling 3.0% from the previous day to trade in the $939 range.

Ahead of today’s UK CPI release, the pound, which had been strengthening against the yen, is now facing resistance. The GBP/JPY pair rose from 184.949 to 186.348 yesterday. It subsequently fell back to the 185 level and is now trending lower. On the daily chart, it appears poised to retest last month’s high, but all eyes are on today’s CPI release to see if the pound can regain ground against the yen.

Today’s economic indicators include China’s Industrial Production at 11:00, the UK’s Consumer Price Index, Retail Price Index, and Producer Price Index at 16:00, France’s Budget Balance at 16:45, the Eurozone’s Consumer Price Index at 19:00, South Africa’s Retail Sales at 20:00,at 9:00 PM: U.S. MBA Mortgage Applications; at 10:30 PM: U.S. Retail Sales, U.S. Import Price Index, and Canadian International Securities Turnover; at 11:00 PM: Remarks by U.S. Fed Vice Chair Barre and U.S. Fed Governor Bowman; at 11:15 PM: U.S. Industrial Production; at 12:00 AM: U.S. Business Inventories;at 12:15 AM: Remarks by ECB President Lagarde; at 3:00 AM: U.S. 20-year Treasury auction results are scheduled to be announced. I intend to watch the situation carefully to see if the pound recovers ahead of the CPI release.