GBP/USD in the spotlight ahead of UK inflation data at 7am GMT

As covered here yesterday, shortly this morning the UK will release its October CPI and RPI inflation reports. This is potentially very important data for the Pound. The markets are expecting a rebound in consumer prices last month, of 0.5%, compared to no rise at all in September. The annualised rate is forecast to rise too, by 2.2%, compared to a 1.7% rise the month before. However, the core rate is expected to slip slightly, to 3.1% from 3.2%. Retail prices are also expected to rise significantly too, by 0.5% from a fall of -0.3% in September. The annualised rate is also forecast to rise, to 3.4% from 2.7%. Ahead of this release the Pound is close to session highs (1.2696) and clearly elevated running into all this data. That kind of makes sense, if we see the kind of rebound in prices the markets are expecting. The prospect of more upside, clearly depends on what this data delivers. So far the Pound has held below the first noted previous top, at 1.2697. The next of those is at 1.2720, as mentioned yesterday and then we have that 200 day moving average, in place at 1.2821 this morning. All of those are on the radar right now and on the downside we have 1.2613 and then 1.2597. The GBP/USD is right now at 1.2689