UK CPI for December came in at 0.4% MoM, double the market consensus. Prices rose 4.0% in the year, up from 3.9% in November (versus 3.8% expected). Markets pared BoE rate cut expectations further in response to the data. 

Sterling’s snap higher from the intraday low just under 1.2600 preserves the broader 1.2600/1.2825 trading range for the past month for a little longer. 

Intraday price action is supportive and may see the Pound’s rebound extend modestly (to the mid-1.27s) in the near-term.