020 7898 0500Sterling set fresh five-and-a-half year highs against the US dollar and a new 22-month high against the euro earlier in the week as inflation data exceeded expectations to come in at 1.9%, just below the 2% target set by the Bank of England (BoE). A high level of inflation is likely to put pressure on the BoE to raise interest rates sooner rather than later, and speculative investors rushed to support sterling on the back of this data.
Mixed labour data from the UK saw a positive fall in unemployment to 6.5% – the lowest since 2008; however, a sharp drop in wage growth saw sterling lose ground against the euro and US dollar at it may force the Bank of England (BoE) to push back the expected rate hike until later in the year.
No major data is set to be released from the UK today, however as news continues to break surrounding the Malaysian jet and Gaza strip, we could see significant movement in the market.
