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GBP/USD recovers to hourly 200-SMA

FXStreet (Mumbai) - The GBP/USD pair dropped sharply to the lowest levels since Oct 7 after the poor UK CPI print, and now attempts a minor-recovery as Bank of England’s (BOE) Vlieghe testifies on his appointment before the Treasury Select Committee, in London.

GBP/USD hovers around hourly 200-SMA

The GBP/USD pair drops -0.69% to 1.5242, recovering from fresh session lows struck at 1.5232 in last hours. The major faces stiff hurdle to the upside at the hourly 200-SMA place at 1.5252 and hovers around it, unperturbed by the comments from the newly appointed BOE MPC member Vlieghe.

Vlieghe noted, “Next move for interest rates is more likely to be up than down”, while adding that “BOE has time to wait and see before raising rate.”

However, the pair remains submerged into losses as the UK inflation report spooked markets and pushed back BOE rate hike bets to early 2016. The UK CPI y/y slipped back into deflationary territory by 0.1% in September from the previous flat growth.

Looking ahead, the major will be influenced by the sentiment on the European and the US stocks amid a data-dry US session ahead. While focus now shifts towards UK’s employment data due to be released tomorrow.

GBP/USD Levels to consider

The pair has an immediate resistance at 1.5300 (psychological levels) above which gains could be extended to 1.5334 (hourly 50-SMA) levels. On the flip side, support is seen at 1.5218 (Oct 7 Low) below which it could extend losses to 1.5195 (H1 S1) levels.

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