Pound Rallies to 8-Month Highs on Upbeat UK Inflation Report

The  Sterling pound today rallied to  new multi-month highs against the  US dollar following the  release of  the  upbeat UK inflation data earlier today. The  GBP/USD currency pair today rallied to  new 8-month highs against the  much weaker greenback on  the  news.
The GBP/USD currency pair today rallied to a high of 1.3266 based on the inflation report, but quickly gave up its gains dropping to a low of 1.3229 and was off its highs at the time of writing.
The  currency pair fell earlier today as  investors took profits on  their positions following yesterday’s massive rally before the  CPI data was released. The  pair spiked higher after the  UK’s Office for  National Statistics released the  country’s CPI report for  July. Headline inflation rose 0.4% beating analysts estimates of  a  0.1% decline translating into an  annualised 1% versus the  expected 0.6% print. The  mixed UK producer price index report for  July dragged the  pair lower as  some figures missed expectations. The  positive UK retail price index for  July, which came in  at  0.5% versus consensus estimates of  0.1% also boosted the  pair.
The  currency pair’s performance was also supported by  the  greenback’s overall weakness as  tracked by  the  US Dollar Index, which hit a  low of  92.15 today. Investors seem keen to  dump the  dollar ahead of  the  November US presidential election, which could see Donald Trump either lose or  maintain his position.
The  currency pair’s future performance is likely to  be affected by  US dollar dynamics for  the  rest of  the  day.
The  GBP/USD currency pair was trading at  1.3249 as  at  08:09 GMT, having rallied from a  low of  1.3229. The  GBP/JPY currency pair was trading at  139.69, having risen from a  low of  139.33.
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