| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 07:00 | United Kingdom | Retail Price Index, m/m | February | -0.1% | 0.8% | 0.6% |
| 07:00 | United Kingdom | Retail prices, Y/Y | February | 3.6% | 3.6% | 3.4% |
| 07:00 | United Kingdom | HICP, Y/Y | February | 3% | 2.9% | 2.8% |
| 07:00 | United Kingdom | HICP ex EFAT, Y/Y | February | 3.7% | 3.6% | 3.5% |
| 07:00 | United Kingdom | HICP, m/m | February | -0.1% | 0.5% | 0.4% |
| 07:45 | France | Consumer confidence | March | 93 | 94 | 92 |
GBP depreciated against other major currencies in the European session on Wednesday, as investors digested the UK’s consumer price index (CPI) data, which showed inflation slowed more than anticipated in February.
The Office for National Statistics (ONS) reported that the UK’s inflation rate eased to 2.8% YoY in February from 3.0% YoY in the previous month. Economists had forecast the headline CPI to slip to 2.9% YoY in February. The core inflation rate, which strips out food and energy, also slowed last month, hitting 3.5% YoY, down from 3.7% YoY in January. Economists had predicted the core inflation to cool to 3.6% YoY in February. Meanwhile, thoroughly monitored services inflation - a key inflation metric for the Bank of England - remained unchanged at 5.0% YoY, disappointing economists, who had expected services inflation to fall to 4.9% YoY.
Today’s CPI figures prompted markets to increase their bets for an interest rate cut at the BoE’s May 8 meeting. According to Bloomberg, they are now pricing in more than a 70% probability of a 25-basis-point rate reduction in May.
Now, investors’ focus is on the UK’s chancellor Rachel Reeves’s spring statement, which is set to be delivered at around 12:30 GMT alongside the updated economic projections from the Office for Budget Responsibility (OBR).