Sterling Slips on UK Inflation Misses, But GBP/CAD Bullish Case Remains Intact

Sterling came under modest pressure after UK inflation data undershot expectations in May, but the report is unlikely to materially alter the Bank of England's policy outlook or the broader bullish case for some GBP crosses. Headline CPI held steady at 2.8% yoy, below expectations for a rise to 3.0% yoy, while monthly inflation slowed sharply from 0.7% mom to 0.2% mom.