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UK November CPI Rises Slower, GBPUSD Drops-TraderFactor

UK November CPI Rises Slower, GBP/USD Drops

The United Kingdom’s Consumer Price Index (CPI) saw an annual increase of 3.9% in November, a decline from October’s 4.6% rise. This figure was lower than the market’s anticipated acceleration of 4.4%. Meanwhile, the Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 4.2% year over year to November 2023, down from 4.7% in October 2023.

On a monthly basis, both CPI and CPIH fell, with the former dropping by 0.2% and the latter decreasing by 0.1%. These figures contrast with November 2022’s rise of 0.4% for both indices.

Key Contributors to Inflation Trends

The most significant downward contributions to the monthly change in both CPIH and CPI annual rates were from transport, recreation and culture, and food and non-alcoholic beverages.

Core Inflation Figures

Excluding volatile items such as energy, food, alcohol, and tobacco, core CPIH rose by 5.2% in the 12 months to November 2023, down from 5.6% in October. Similarly, core CPI increased by 5.1% year over year in November, a decrease from October’s 5.7%. Both figures were lower than the expected 5.6%.

GBP/USD Reaction to Inflation Data

The release of the UK’s inflation data triggered a selling wave for the GBP/USD, causing it to drop below 1.2700. The pair has fallen 0.60% on the day, trading above 1.2650.

GBP/USD

Long-Term Inflation Trends

The CPIH rose by 4.2% in the 12 months to November 2023, down from October’s 4.7% and a peak of 9.6% in October 2022. This suggests that the October 2022 rate was the highest in over 40 years. In contrast, November 2023’s annual rate was the lowest since October 2021.

IndexNov 2023 YoYOct 2023 YoYNov 2023 MoMNov 2022 MoM
CPI3.9%4.6%-0.2%0.4%
CPIH4.2%4.7%-0.1%0.4%
Core CPI5.1%5.7%N/AN/A
Core CPIH5.2%5.6%N/AN/A

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Author

  • Zahari Rangelov

    Zahari Rangelov is an experienced professional Forex trader and trading mentor with knowledge in technical and fundamental analysis, medium-term trading strategies, risk management and diversification. He has been involved in the foreign exchange markets since 2005, when he opened his first live account in 2007. Currently, Zahari is the Head of Sales & Business Development at TraderFactor's London branch. He provides lectures during webinars and seminars for traders on topics such as; Psychology of market participants’ moods, Investments & speculation with different financial instruments and Automated Expert Advisors & signal providers. Zahari’s success lies in his application of research-backed techniques and practices that have helped him become a successful forex trader, a mentor to many traders, and a respected authority figure within the trading community.