GBP Struggles to Maintain Support Levels – Overview for July 20, 2023
<div><img width="360" height="360" src="https://blog.roboforex.com/wp-content/uploads/2023/06/GBPUSD_7-360×360.jpg" class="attachment-thumbnail size-thumbnail wp-post-image" alt="GBP/USD analysis today" decoding="async" loading="lazy" style="margin-bottom: 15px;" /></div><p><a href="https://roboforex.com/beginners/info/charts/forex/gbpusd/" data-internallinksmanager029f6b8e52c="36" title="GBP/USD">GBP/USD</a> Continues Moderate Correction.</p>
<p>The British pound sterling has paused its rally against the US dollar, entering a corrective phase. The current GBP/USD exchange rate is 1.2950.</p>
<p>Yesterday's release of the UK Consumer Price Index for June showed a decline to 7.9% year-on-year from 8.7% in the previous month. Core <a href="https://blog.roboforex.com/blog/2022/06/30/what-is-inflation-reasons-and-consequences/" data-internallinksmanager029f6b8e52c="220" title="Inflation">inflation</a> also decreased to 6.9% year-on-year, down from 7.7% in May. This drop in inflation, combined with the pound's apparent overbought condition, appears to be the reason for its decline. As prices <a title="<div class="wpg-tooltip-content"><p>A trend is a direction in which the market or the price of an instrument is moving. Trends can be upward, downward or sideways and are common to all types of markets.</p></div>" href="https://blog.roboforex.com/glossary-terms/trend/">trend</a> downward, the Bank of England is likely to take a cautious approach to raising interest rates.</p>
<p>The input Producer Price Index (<a href="https://blog.roboforex.com/blog/2021/09/24/what-is-ppi-and-how-to-use-it/" data-internallinksmanager029f6b8e52c="202" title="PPI">PPI</a>) fell by 1.3% month-on-month, following a previous 1.2% decrease. On the output side, the same indicator decreased by 0.3% month-on-month, compared to a 0.6% decline in May.</p>
<p>The Retail Price Index (RPI) also experienced a decline, dropping to 10.7% year-on-year in June from the previous 11.3%.</p>
<p>All these reports point to one thing: local price pressures have eased. While this may be beneficial for the economy and consumers, it poses challenges for the GBP exchange rate.</p>
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