GBP/USD yet to react to firmer UK CPI data but it should

The important UK January inflation data has now been released. As noted here earlier this morning, the markets were expecting a monthly fall in CPI to be more than countered by significant increases in the longer-term annualised readings. The actual data has revealed that it did not. The monthly rate only fell by 0.1% and the longer term readings have beaten forecasts. Annual CPI rose by 3% (2.8% forecast) and the core rate rose, as expected to 3.7%. The RPI data was a little below forecasts, at 3.6% annualised, but still elevated all the same. The services index rose to 5% which was just below the 5.1% rate forecast. The GBP/USD was trading just below  1.2620 leading into this data, down from an earlier session high, at 1.2640. The impact of this news has not seen it move much yet, which is a little surprising. So, the take away from this news, is more pressure on the BOE to hold off on further rate cuts in the coming 3 months. The Pound should take heart from that, but it sure is quite slow in doing that right now. The GBP/USD is currently at 1.2620