Sterling may come off the boil if UK CPI cools
July 15 (Reuters) - The pound might cede some of its recent gains against the dollar, euro and other major currencies if UK inflation data for June comes in cooler than expected on Wednesday at 0600 GMT.
Below-forecast UK inflation data would be a welcome boost for doves on the Bank of England's Monetary Policy Committee, including Swati Dhingra, who want interest rates cut on Aug. 1.
UK CPI is forecast to match the BoE's 2.0% YY target level for a second consecutive month, according to a Reuters poll, with services CPI forecast at 5.6% YY versus May's 5.7% (which was hotter than expected).
CFTC data on FX positioning showed the net GBP long jumped 36% to a 17-year high of 84,690 contracts in the week ended July 9 - before the pound was lifted by a relatively hawkish speech from BoE Chief Economist Huw Pill which dampened expectations of a BoE rate cut next month.
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(Robert Howard is a Reuters market analyst. The views expressed are his own)
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