UK CPI data boosts GBP/USD

Stronger-than-expected UK inflation data leads to a notable increase in the GBP/USD pair

By Farah Mourad | 22 May 2024

Market open
  • The Reserve Bank of New Zealand maintains its interest rate at 5.5%

  • Gold trades above $2,400

  • Investors await Federal Reserve minutes

Stock Market

The Asian stock markets are showing varied performance today. Japan's Nikkei 225 is experiencing a decline, while Chinese stock indices are on the rise. European futures are pointing towards a neutral start to the trading session.

The GBP/USD pair has edged higher following the release of stronger-than-expected UK CPI inflation data:

UK Inflation Data (April)

  • CPI (MoM): 0.3% (forecast 0.2%; previous 0.6%)
  • CPI (YoY): 2.3% (forecast 2.1%; previous 3.2%)
  • Core CPI (YoY): 3.9% (forecast 3.6%; previous 4.2%)
  • Core CPI (MoM): 0.9% (forecast 0.7%; previous 0.6%)


Despite a reduction in the energy price cap, inflation remains a concern, particularly with services inflation at 5.9% annually. The release of this data has led to a notable increase in GBP/USD, indicating a market surprise and sustained momentum.

The Reserve Bank of New Zealand (RBNZ) has kept its interest rates steady at 5.5% for the seventh meeting in a row, indicating a prolonged period of restrictive monetary policy to tackle stubborn inflation. Consequently, the New Zealand Dollar is a standout performer among the G10 currencies, alongside the pound.


Gold prices continue their upward trajectory this week, trading above $2,400. Investors are closely monitoring upcoming comments from Federal Reserve officials, and the Federal Reserve's minutes, due later today, are anticipated to provide insights into the committee's current stance on monetary policy, especially given recent hawkish remarks from FOMC members.