• GBP/USD backslid another two-thirds of one percent on Wednesday.
• Cable shed more weight after UK CPI inflation figures missed the mark.
• US & UK Retail Sales figures go head-to-head with releases on Thursday and Friday, respectively.

Tension snapped in GBP/UISD chart action on Wednesday, with Cable losing the tug of war and backsliding out of recent congestion. Cable tumbled two-thirds of one percent and slipped below the 1.3000 handle during the midweek market session. GBP markets withered after UK Consumer Price Index (CPI) inflation figures missed the mark, sending the Pound Sterling to a fresh eight-week low.

UK CPI inflation number widely missed median market forecasts as inflation drops faster and further than investors initially anticipated in September. Headline CPI inflation for the year ended in September eased to 1.7% from 2.2%, with markets expecting a print of 1.9%. Core CPI inflation remains stubbornly higher than headline inflation measures, but still eased faster than expected, dipping to 3.2% YoY from the previous 3.6% and wringing extra out of the forecast 3.4%.

The UK is witnessing its slowest pace of annual inflation growth since May of 2021, and rising concerns of a deepening economic slowdown are dragging Cable lower. UK Producer Price Index (PPI) figures also contracted more than expected in September, with headline PPI Output prices swooning -0.7% YoY, below the forecast -0.6% and eating away the previous 0.2%. The UK Retail Price Index also hit its lowest measure since April of 2021, falling to 2.7% YoY compared to the previous period’s 3.5% and the median market forecast of 3.1%.