GBP/CHF gains as UK CPI adds to BoE cut prospects

The GBP/CHF currency pair registered modest gains on Wednesday, after touching an intraday high of 1.1372, as data showed UK consumer price inflation had eased to its lowest level since September 2021 in March.

Annual CPI inflation slowed to 3.2% in March from 3.4% in February, while market consensus had pointed to a slowdown to 3.1%.

The drop was mostly driven by a slowdown in food inflation (4% versus 5% in February).

UK’s annual core CPI inflation, which excludes volatile categories such as food and energy, decelerated to 4.2% in March from 4.5% in February. It has been the lowest core inflation rate since December 2021.

The inflation report bolstered the case for an interest rate cut by the Bank of England.

Meanwhile, in other data, CHF traders will be paying attention to the March trade figures, which Switzerland is due to report on Thursday, for more clues on the nation’s economic growth.

In February, Switzerland reported a trade surplus of CHF 2.2 billion.

Currency Pair Performance

As of 10:25 GMT on Wednesday the GBP/CHF currency pair was edging up 0.25% to trade at 1.1364.

The minor Forex pair has pulled back from a 41-week high of 1.1485, which it registered on April 4th.