GBP/USD pierced 1.2700 on UK CPI

The Sterling has gathered extra upside momentum following the release of UK’s CPI results, pushing GBP/USD to fresh highs above the 1.2700 handle.

GBP/USD stronger on CPI

Spot picked up further pace after consumer prices in the UK economy have risen more than expected 1.2% on a year to November and 0.2% on a monthly basis, matching initial estimates.

The pair clinched fresh multi-daily highs beyond the key 1.2700 barrier in the wake of the results in a key week for GBP, as UK’s labour market figures, retail sales and the BoE MPC meeting are all expected in the upcoming sessions.

However, the current upside in Cable will be put to the test in light of the FOMC meeting due tomorrow, where market participants have practically priced in a 25 bp rate hike.

GBP/USD levels to consider

As of writing the pair is up 0.19% at 1.2706 facing the next hurdle at 1.2767 (100-day sma) ahead of 1.2776 (high Dec.6). On the other hand, a break below 1.2548 (low Dec.9) would expose 1.2457 (55-day sma) and then 1.2297 (low Nov.18).