The Pound Sterling (GBP) is consolidating in a narrow range near 1.2750 against the US Dollar (USD) as investors await the upcoming US inflation data for November, which will be released on Wednesday. Economists expect annual headline inflation to have increased to 2.7%, with core CPI rising to 3.3%. Unless there is a major deviation from expectations, the inflation data is unlikely to alter market expectations for the Federal Reserve’s (Fed) rate decisions.
The BoE (Bank of England) is expected to keep interest rates unchanged at 4.75% in its December 19 meeting, with inflation in the UK rising slightly. This has boosted investor confidence in the Pound. Investors will also focus on UK GDP and industrial production data for October, which could further influence the Pound’s movement.
Pound Sterling technical outlook: GBP/USD is aiming for the key resistance level at 1.2800, with the 20-day EMA around 1.2720 providing support. If the pair breaks below 1.2500, it may find further support from the upward-sloping trendline drawn from October’s low.
