British CPI falls, pound hits 8-and-a-half-year peak against yen
On Wednesday, the pound-yen currency pair extended its gains of the past six sessions, surging to 192.854, a record high in eight and a half years。
On Wednesday, the pound-yen currency pair extended its gains of the past six sessions, surging to 192.854, an eight-and-a-half-year high, as investors bet that the Bank of Japan will keep monetary policy loose after deciding to move away from negative interest rates。
Yesterday, the pound-yen currency pair rose more than 1% after the Bank of Japan ended an eight-year period of negative interest rates and stopped controlling the yield curve on 10-year government bonds.。
At its March meeting, the Bank of Japan raised short-term interest rates from -0.1% up to 0% - 0.1%, the first rate hike since 2007。However, the central bank said it expected to maintain accommodative conditions in the short term, while increasing pressure on the yen.。
Meanwhile, the latest Office for National Statistics data showed that the UK's annual inflation rate fell to 3 per cent in February from 4 per cent in January and December..4%, lower than expected, while reinforcing the argument for a rate cut。
This is the lowest level since September 2021, mainly due to slower price increases for food and non-alcoholic beverages, restaurants and hotels, entertainment and culture, and other goods and services.。
The UK's annual core CPI inflation rate (excluding volatile categories such as food and energy) for February was up from 5 in the previous three months..1% down to 4.5%, the lowest core inflation rate since January 2022。
The figures were released a day before the Bank of England's second policy meeting this year.。The Bank of England is expected to keep its benchmark interest rate at 5 at its fifth consecutive meeting in March..16-year high of 25% unchanged。
In February, two monetary policy members voted for a 25 basis point rate hike, while one member voted for a 25 basis point rate cut.。
The Bank of England says monetary policy must be maintained long enough to bring inflation down to its 2% target level sustainably over the medium term。However, the central bank removed references to further tightening of monetary policy from its statement, noting that inflation risks were more balanced.。
As of 8: 01 GMT Wednesday, the pound was up 0 against the yen.37%, traded at 192.554。
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