The pound hit its highest level against the dollar This kind of year after UK inflation was stronger than expected in August.
The latest official figures showed the CPI inflation rate rose to 2.9% in August as fuel in addition to also clothing prices increased. which was up via July’s rate of 2.6% in addition to also above forecasts of 2.8%.
Sterling jumped on the news, in addition to also finished up 0.84% to $1.3275 at the end of London business hours, a year high.
The pound was also higher against the euro, up 7% at 1.1096 euros.
The latest inflation figure could put further pressure on the Bank of England to consider a rise in interest rates, as which has an inflation target of 2%.
The Bank will announce its latest decision on rates on Thursday. However, analysts are not expecting which to take any action yet.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said he thought the prospects of a rate rise This kind of year were “remote”.
“Domestically-generated inflation is actually subdued, inflation expectations have remained well-anchored in addition to also GDP growth is actually too weak to warrant higher rates,” he said.
The jump inside the pound sent shares lower, with the FTSE 100 share index ending down 12.9 points at 7,400.69.
Shares in broadcaster Sky fell 5% at one point after the UK government again said which was “minded” to investigate further 21st Century Fox’s bid to take over the whole company.
Fox owns 39% of Sky although wants to assume total control of the broadcaster.
However, some fear which would certainly give Rupert Murdoch’s family, which controls Sky, too much sway over the UK media. Sky shares closed down 1.5%, while Fox shares were little moved.
Shares in industrial equipment hire group Ashtead jumped 5% after the firm said which should see increased demand inside the US following Hurricanes Harvey in addition to also Irma.
The clean-up operation following the two hurricanes is actually supposed to mean greater demand for the company’s diggers in addition to also tools.
inside the FTSE 250 index, shares in JD Sports rose 9% after which brushed aside any fears of a downturn inside the “athleisure” sector by reporting a big rise in both sales in addition to also profits.
inside the six months to the end of July, sales rose 41% via a year earlier to £1.4bn with pre-tax profits climbing 33% to £103m.