GBP/USD unchanged ahead of CPI, around 1.2970

The Sterling is navigating within a narrow range vs. the greenback ahead of the opening bell in Europe, taking GBP/USD to the 1.2970 ahead of key UK data releases.

GBP/USD attention to CPI

Cable is struggling for direction at the end of the Asian session on Tuesday, meandering the lower end of the recent range in the 1.2970/60 band.

Furthermore, the pair still looks vulnerable amidst a recovery of the greenback while cautiousness among traders is expected to prevail ahead of the release of UK’s inflation figures tracked by the CPI for the month of July. Yields of the US 10-year reference remains on a strong footing vs. the downtrend seen in its UK peers.

Prior surveys expect headline consumer prices to have gained 2.7% on a year to July, while core prices are seen up 2.5% over the last twelve months.

Data wise across the pond, July’s retail sales will be the salient release this week ahead of tomorrow’s FOMC minutes. Additional publications include the NAHB index, the regional manufacturing gauge by the NY Empire State index, business inventories and TIC flows.

GBP/USD levels to consider

As of writing the pair is flat at 1.2965 facing the next hurdle at 1.3035 (10-day sma) followed by 1.3063 (high Aug.7/10-day sma) and finally 1.3106 (23.6% Fibo of 1.2587-1.3266). On the other hand, a breakdown of 1.2937 (low Aug.11) would open the door to 1.2932 (55-day sma) and finally 1.2859 (100-day sma).