The pound-euro (GBP/EUR) exchange rate is falling, snapping a 3-day winning run.
The pound is falling after UK inflation (CPI) cooled to 1.7% YoY, down from 2.2%. This marked the first time in 3 years that inflation is below the BoE’s 2% target.
Service sector inflation cooled to 4.9% from 5.6% – the largest decline since 2020.
The data paves the way for the BoE to cut rates in November and possibly again in December.
The euro is rising against the pound but falling against the USD.
Attention is on tomorrow’s ECB meeting, where the central bank is expected to cut rates by 25 basis points.