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GBP/USD comes off the boil as UK CPI falls more than expected in October

The October UK monthly CPI and RPI inflation reports have just been released. As mentioned here earlier, the markets were forecasting a sharp fall across all these readings last month. The actual data has revealed an even lower set of readings. Monthly CPI was at zero and the annualised rate was lower than forecast, at 4.6%. The RPI data actually fell by 0.2% and the annualised rate fell to 6.1%, from a forecast of 6.3%. The GBP/USD has reacted to the news, by falling back slightly, but so far the markets do not seem so surprised by these readings. Once again, if you are surprised by this lack of reaction, then you are not alone. This data has very much endorsed the outlook for UK rates to have now peaked, certainly for 2023 at any rate. It also tells us just how unloved the dollar is right now too. The GBP/USD is a little lower though, currently trading at 1.2473
 

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