GBP faces the risk of encountering selling pressure. Overview for 01.11.2023

The British pound, paired with the US dollar, is trending lower. The current GBPUSD exchange rate stands at 1.2136.

A British retail trade consortium reported yesterday that inflation in UK stores is on a declining trend. In September, the inflation rate reached 5.2%, marking the fifth consecutive month of decline. The last time such a low level was recorded was in August 2022.

The report highlights that one of the pivotal factors contributing to the price decline is the reduction in mark-ups on domestically grown food products.

A year ago, the overall inflation in the UK stood at 11%, marking a 41-year high. Since then, prices have been on a decline and have reached 6.7%.

The reduction in inflationary pressure at the consumer level is a positive signal for the pound. However, in the near future, investors may not give it much attention as the focus shifts to the Federal Reserve's meeting and the release of the NFP employment report in the US for October on Friday.