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GBP struggled yet again, as the latest set....>

FOREX
FOREX: GBP struggled yet again, as the latest set of inflation data missed
estimates. This prompted a $1.3010 print in GBP/USD, representing a fresh YtD
low, although rates markets were relatively unchanged after the data. MNI's
PINCH model still sees the probability of an August rate hike at just under 80%.
GBP/USD calls were in vogue, with focus on expiries just after the BoE's Aug
rate decision, with strikes layered from $1.3150-1.3500. There was a late, ltd
relief rally on a report that an extension to the Article 50 deadline is being
discussed in the backrooms of Brussels, as MEPs & off'ls from member states
weigh up plans to avoid a cliff-edge Brexit (although horizons touted vary).
- Antipodean FX performed well again, with AUD & NZD rising against all others
and any break above the respective NZD/USD and AUD/USD 50-DMAs may confirm that
the pairs have printed a near-term bottom.
- The session saw little outright USD price action, with the greenback flat
following Powell's largely unchanged testimony.
- Focus turns to UK retail sales, AU labour mkt report & Fed's Quarles on
Thursday.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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