• GBP/USD roiled on Wednesday before settling 0.2% lower.
• Despite an upbeat UK CPI inflation print, Cable knocked lower.
• Thin Thursday economic calendar gives way to global PMI prints.

GBP/USD struggled to find a direction on Wednesday, testing the bounds of the 1.2700 handle before facing a downside rejection and ending the midweek market session a fifth of a percent lower than it started. Despite an above-forecast print in UK Consumer Price Index (CPI) inflation figures, the Pound Sterling still waffled as the Bank of England (BoE) looks set to write off another rate cut in 2024 as the UK grapples with still-sticky inflation.

UK CPI came in broadly higher than markets expected, with headline UK CPI inflation rising to 2.3% YoY, over and above the forecast 2.2% and bouncing from the previous period’s print of 1.7%. Meanwhile, core CPI inflation rose to 3.3% on an annualized basis while investors were expecting a slight downtick to 3.1% from the previous 3.2%. With UK inflation still sparking fears of sticky price growth, the BoE is less likely to deliver another rate cut in 2024 despite a lopsided economy.

Thursday’s economic calendar is a thin showing, leaving Cable traders to sit on their hands until Friday’s doubleheader showing of Purchasing Managers Index (PMI) activity survey results due from both the UK and the US to wrap up the trading week. UK PMI figures are broadly expected to hold steady at previous figures, with the Manufacturing PMI component forecast to hold at 49.9 and the Services PMI component expected to print flat at 51.8.