After rallying against the euro yesterday, the pound has lost some of its strength this morning but remains up on this time last week. Against the dollar, sterling remains weaker.
The main driver of currency movements was the European Central Bank’s much-anticipated monetary policy decision. The ECB signalled that it is likely to raise interest rates by 25 basis points in July, rather than the rumoured 50, to tackle rising inflation in the eurozone. The bank did, however, suggest a 50 basis point increase could be on the cards in September.
The euro initially weakened following the ECB decision but soon consolidated some of its losses.
In the UK, the cost of filling up an average 55-litre car reached £100.27 yesterday. This comes despite a 5p cut to fuel duty which many people say has not been passed down to consumers. Fuel prices have also been impacted by the pound falling against the dollar which has increased the cost of buying fuel wholesale for retailers.
Today, all eyes are on US inflation figures.
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