The pound is still strong against the euro and the dollar after surging yesterday.
This morning, UK inflation figures for February have come in higher-than-expected. Annual inflation rate increased to 6.2%, up from January’s reading of 5.5% and above market forecasts of 5.9%. It is the highest inflation rate since March of 1992.
The cost of food and energy have contributed to this uplift, as well as rising transport costs and the price of furniture and household goods.
High inflation could increase expectations for more interest rate hikes from the Bank of England this year. This week, the markets have increased expectations for more rate hikes this year, causing the pound to strengthen.
