GBP: EURGBP Best Vehicle For Hawkish BOE Reaction (1/2)

Dutch flash HICP inflation rose to 3.94% in December, up from 3.79% in November, in line with the 3.9% expected but almost rounding up to 4.0%. The sequential reading was 0.34% M/M (0.3% cons; -1.0% prior). However, the headline acceleration was energy-driven, as core HICP eased to 3.58% from 3.66% but the moderation for the latter saw mixed drivers. 

• Non-energy industrial goods played a large role in the moderation in core, sliding to -0.03% Y/Y vs 1.30% Nov.
• Services however accelerated for the third consecutive month, to 5.86% in December (vs 5.18% prior) for its highest since Aug and Aug 2023 before that. This series peaked at 7.5% in mid-2023 and mostly averaged between 1-3% pre-pandemic.  
• Food, alcohol and tobacco inflation accelerated to 6.61% Y/Y (vs 6.13% prior), a solid acceleration from February's local low of 2.66% but well off highs of over 15% Y/Y seen in 2023.
• Energy inflation accelerated to 1.37% (vs -0.29% Nov) on the back of base effects as the sequential reading was -0.10% M/M.
• The national CPI meanwhile came in above consensus at 4.1% Y/Y (vs 4.0% cons and prior).
• The final Netherlands HICP/CPI inflation release will be on January 14.
• For reference, Netherlands represents 5.7% of the overall 2024 Eurozone HICP basket.

Source: Bloomberg

JPYUSD (7th Feb) 58.00p sold at 0.035 in 1k today.

• This was also sold at 0.035 Yesterday in 2.7k, and while it wasn't clear if this was a new position, the rise in OI from 7.8k to 12.4k suggest that it is.