EUR/GBP in the spotlight with crucial UK inflation data due out early this morning

At 7am GMT the UK will release its January CPI report. This of course follows hot on the heels of the US CPI data seen yesterday. Generally speaking the markets got it wrong on the outlook for that and it remains to be seen if they will do so again today, when it comes to calls for the UK numbers. We also have the January RPI (Retail Price index) data due out too. So, the consensus is for CPI and RPI to remain elevated on an annualised basis, but fallen back on the monthly readings . So there is clearly disparity there and I will look at that in an update to follow ahead of the release at 7am GMT. Meantime, the immediate focus here is on the EUR/GBP. Finally the EUR/GBP traded at 0.8500 yesterday. In fact it nailed that level to the pip and then bounced slightly, before later closing in the US at 0.8504. Trading the EUR/GBP to avoid the dollar, yet take advantage of any GBP strength/weakness was a wise move yesterday, and the Pound will stand up or fall down on this UK data this morning. There is plenty more to add here ahead of the release. The EUR/GBP is currently trading at 0.8502