GBP Gains Traction as UK CPI Accelerates, PPI Surpasses Expectations

The British pound has gained momentum against the US dollar after the UK's consumer price index (CPI) rose to 0.5% in August from 0.3% in July, according to figures released by the UK Office for National Statistics.

This increase brings the yearly CPI to 3.1%, up from 2.9% previously. Meanwhile, the Producer Price Index (PPI) rose to a 6.1% year-over-year rate in August, surpassing market consensus of 5.4%. The Output PPI accelerated to 3.7% Y-o-Y from 3.1% in the previous month.

The GBP/USD ticked higher to trade at $1.3485 but remains 0.3% lower on the week so far, as markets await a Federal Reserve rate hike decision due later in the day.