UK Inflation rose more than expected to its highest level in more than a decade, adding increasing pressure on the Bank of England to raise interest rates. Prices for consumers rose 5.1% from a year earlier against an expected 4.8% as clothing and fuel costs rise. Core inflation which strips out energy prices also rose to 4% the highest since 1992.
As a result GBP/EUR rose nearly a percent and GBP/USD has risen half a percent. This will present a challenge to the Bank of England who meet tomorrow to vote on interest rate and monetary policy changes.
As traders brace themselves for a faster withdrawal of Federal Reserve stimulus and Omicron risks, most Asian stocks fell, and US equity futures wavered. The FTSE100 has also followed a similar path to this week and opened slightly down.
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