020 7898 0500Given the slide in sterling (pound, GBP) and the forecast for inflation it was no real surprise that inflation hit the highest level seen since October 2014. Inflation rose to 1.2 percent, with increased pricing in petrol, food and non-alcoholic beverages. The drop in sterling has added to the woes of the economy. The Bank of England (BoE) expects inflation to continue to rise during 2017 to 2.7 percent and remain above the 2 percent target until 2020. Sterling received a small boost after the release of the number, as it was slightly higher than expected. If this trend continues it could place additional pressure on the BoE to raise interest rates sooner than expected.
The all-important UK employment data is released today. The two key barometers that are watched intently are the average earning and the claimant change – new filings for job seekers allowance. The average earnings, which measures salary inflation, is expected to hold steady at 2.3 percent, while the claimant change is expected to grow by 6,800. In addition, BoE Governor, Mark Carney is to speak at the launch of the Task Force on the climate-related Financial Disclosures Phase II Report. Unlikley but if we should see any signposting of future monetary policy we could see sterling volatility.
