Money News Overview Friday 12th July: The pound surges to a new 2024 high versus the dollar

Yesterday, markets were mostly focused on US CPI inflation data for June. The dollar suffered its greatest daily loss in a month as the United States reported that inflation fell last month, enhancing the possibility of a Federal Reserve rate drop in September.

The pound-to-dollar currency rate broke above the 1.29 barrier to reach a new 2024 high after U.S. CPI inflation fell -0.1% month-on-month in June, down from 0% in May and below expectations of a 0.1% gain.

ese inflation figures are the latest in a number of US economic reports that have come in below expectations. Last week’s job report revealed a 111K decrease to expectations of US job growth in April and May. In June, US unemployment jumped to 4.1%.

The Fed will be concerned about going forward, now that the disinflationary trend has resumed.

Today’s European economic diary is quiet. In the United States, the primary highlights are PPI inflation in June and consumer sentiment in July. If the data continue the recent trend of softer US indices, the dollar could remain on the defensive heading into the weekend.

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