The inflation data published today in the UK shows that the 2% mark targeted by many central banks has been reached.
Compared to the previous month, general inflation has fallen again by 0.3% to now 2.0%. The core rate, to which the BoE attaches less importance, has also fallen from 3.9% to 3.5%. Now that the BoE's inflation target has been reached, and against the backdrop of an unemployment rate that has been rising since February to a current 4.4%, the likelihood of the Bank of England cutting interest rates for the first time is increasing significantly. Analysts do not expect this until the monetary policy meeting in July. However, if there are already clear signs of an interest rate cut in July after tomorrow's BoE meeting, this could put pressure on the GBP exchange rate.
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