Pound Falls Versus Dollar as U.K. Inflation Slows
This mornings news from the Forex Trading Floors in Brentwood comes from Bloomberg.
The pound fell versus the dollar as a report showed inflation slowed to the least in five years last month, adding to pressure on the Bank of England to keep interest rates at record lows.
Consumer-price growth slowed to 1.2 percent in the 12 months through September from 1.5 percent in August. That’s the lowest since September 2009 and marks a ninth month below the BOE’s 2 percent target. Data from the British Retail Consortium and KPMG LLP today showed retail sales unexpectedly fell last month from a year earlier. U.K. 10-year government bonds climbed for a seventh day, the longest winning run since August 2011, pushing the yield to the lowest since June 2013.
“Lower inflation, means lower rates, means lower sterling,” said Adam Cole, the head of global foreign-exchange strategy at Royal Bank of Canada in London. “Sterling has gone back to be a fairly conventional interest rate story.”
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