GBP/USD a tad weaker near 1.2650 ahead of UK CPI

The Sterling remains on the defensive during the first half of the week, now sending GBP/USD to the mid-1.2600s, close to recent multi-week lows.

GBP/USD focus on data

Cable is retreating for the fourth session in a row so far on Tuesday, as GBP is deriving downside pressure from the UK’s political scenario while Brexit jitters seem to have returned to town.

In the meantime, GBP is down more than 3% already since YTD tops in the mid-1.3000s seen in the second half of May, largely due to domestic drivers and the moderate pick up in the demand for the greenback. The selling pressure around the British Pound has exacerbated following the results from the UK elections earlier in the month, with investors’ attention now on the potential start of Brexit talks on June 19 and the delayed agreement between Tories and the DUP.

In the UK’s data space, inflation figures tracked by the CPI are due next along with producer prices. Across the pond, NFIB’s index is next on tap seconded by May’s producer prices and the OPEC monthly report. The Federal Reserve will also start its 2-day meeting amidst high bets of a 25 bp rate hike tomorrow.

GBP/USD levels to consider

As of writing the pair is losing 0.09% at 1.2647 and a breakdown of 1.2632 (low Jun.9) would open the door to 1.2622 (100-day sma) and finally 1.2571 (200-day sma). On the upside, the next hurdle lines up at 1.2771 (high Jun.12) followed by 1.2783 (55-day sma) and then 1.2888 (20-day sma).