The rate of inflation across the UK dropped to 2.7% in February 2018 from 3% in the previous month and below market expectations of 2.8%. It was the lowest rate since July last year, as prices increased at a softer pace for transportation, recreation & culture, restaurants & hotels, and food & non-alcoholic beverages.
The news that President Trump is planning $60bln of tariffs on Chinese imported goods, despite warnings at the G20 meeting of the risks of the “America first” agenda. The White House seems to also be lobbying other nations for support against Chinese trade policies, by offering relief from steel and aluminum tariffs. The EU’s trade commissioner is in Washington today to discuss tariffs.
Brexit breakthrough: EU and Great Britain agree on transition period” was the major headline all over the media yesterday that caused Sterling to soar. Initially, we were not totally surprised by the news. On Friday there had already been indications that an agreement in the negotiations over the weekend had become tangible.
Since Australia is having more exposure towards China, GBPAUD would likely have a major impact on this news. As a result, the consolidation phase of the underlying GBPAUD pair on intermediate trend seems to have been exhausted exactly at 1.8266 levels.
Well, overall we favor upside bias a bit than to be the skeptic on GBPAUD. Consequently, one can stay long in futures contracts of near month tenors with a view to arresting further potential risks. On trading grounds, boundary binary options like structures are advocated.
Currency Strength Index: FxWirePro's hourly GBP spot index has turned into 112 (which is bullish after UK CPI prints at 2.7%), while hourly AUD spot index was at shy above -136 (bearish) while articulating (at 12:22 GMT). For more details on the index, please refer below weblink:
http://www.fxwirepro.com/currencyindex
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