The Pound Sterling (GBP) is holding little changed just below the 1.30 point. Focus in the UK falls squarely on Wednesday’s UK CPI report, Scotiabank’s chief FX strategist Shaun Osborne notes.

A retest of last July’s 1.3155 high may develop

“Headline price growth may dip under 2% for the first time since 2021 but markets will want to seen clear progress on sticky services inflation (expected to ease only a tenth to 5.6%) to bolster expectations of an August 1 rate cut (around 50% probability, according to market pricing currently).”

“GBP/USD is little changed on the session so far after consolidating solid gains over the past week just below 1.30. Spot gains are well-supported by intraday, daily and weekly DMI signals and Cable is making solid gains above long term (18Y) trend resistance (1.2645). A clear move above 1.30 suggests a retest of last July’s 1.3155 high may develop. Support is 1.2850/80.”