EUR/GBP may have another go at breaking above 0.87 – SocGen

Soft UK CPI are hurting GBP, Kit Juckes, Chief Global FX Strategist at Société Générale, reports.

Rate rethink is dragging the Pound lower

UK inflation came in lower than expected at 6.7% headline and 6.2% core. The core rate is 0.7% lower than it was in July.

With wage growth too strong and the labour market tight, the Bank of England’s MPC is unlikely to decide to leave rates on hold, but the market has scaled back expectations of a further hike later in the year and that has added to downward pressure to the Pound. 

GBP/USD has 1.20 in its sights, and EUR/GBP may have another go at breaking above 0.87.