Important events today:

21.10 06:00 UTC: GBP Consumer Price Index

British inflation today will determine whether the Pound maintains its edge following strong employment statistics. The market expects annual CPI growth to accelerate from 3.1% to 3.4%. Confirmation of these expectations would reinforce the case for a November rate hike by the Bank of England: persistent price pressure warrants tighter monetary policy and supports the Pound’s appeal.

Yesterday’s data showed a drop in unemployment and resilient wage growth, even as job vacancies continued to decline. This combination does not signal a sharp economic downturn and leaves the regulator room to tighten policy. However, the expected rate hike is already largely priced in, making it crucial for the currency to avoid disappointment in the upcoming release.

From the US side, the Pound is supported by falling bond yields and prevailing expectations of an October Fed pause. While elevated US inflation keeps the risk of renewed Dollar demand alive, the immediate test for the pair centers on UK prices. Barring significantly weaker data, interest rate expectations favor a continued rally in GBP/USD; a dovish release could invalidate the thesis.

Recommendations: BUY 1.3375, SL 1.3340, TP 1.3445.