Published On: Tue, Feb 13th, 2018

Pound LIVE: UK feels the SQUEEZE as inflation sticks at 3% in January | City & Business | Finance

Good morning, and welcome to our rolling coverage of Pound Sterling, Brexit, British business, the eurozone, the world economy and the financial markets.

Updates below throughout the day….

The Pound is down on the Euro and flat on the Dollar at breakfast this morning as the world once again turns its attention to the stock markets.  

The FTSE is expected to open 7 points higher at 7184 this morning with the German DAX up 26 points to 12,308, and the French CAC up 12 points to 5152.

In news that will surely warm the cockles of your heart this cold February morning, the UK is due to leave the European Union three months early as the Brexit team look set to agree to a shorter transition period than the original two years, it has been revealed.

Matt Drake reports that EU negotiator Michel Barnier said the cut off should be December 31, 2020, after he said the UK must “decide” what kind of Brexit it wants.

Now the UK is going to accept an exit timetabling suggested by Brussels rather than London.

A Whitehall source directly involved with the UK’s exit planning said: “The EU timetable is the working assumption and no one seems too upset by that.”

Former Cabinet Minister and ardent Brexiteers Iain Duncan Smith said: “The sooner we can get this done, the better.

“What everyone needs is certainty, not a ‘never-end-um.’”

9.35am – UPDATE – UK inflation at 3 percent 

Inflation has not fallen to 2.9 percent as expected and remained at 3 percent in January.

More to follow…

9.32am – UPDATE – Pound in the green

Sterling is up a thin 0.08 percent against the Euro to 1.1266, and up against the Dollar 0.27 percent to 1.3886.

8.40am – UPDATE – Inflation data

UK inflation figures are released this morning with the Consumer Prices Index expected to fall to 2.9 percent in January, down from December’s 3 percent.

Conor Campbell from SpreadEx says that it has been a nervy start for FTSE and pound ahead of crucial UK inflation data.

“After Monday’s largely unchallenged rebound, the markets face a test of their mettle this Tuesday with the release of the latest UK inflation reading.

“The European indices were clearly very jittery after the bell. The FTSE was the best performer, and even then if found itself sporadically dipping into the red by 10 or so points. The situation in the Eurozone was more negative; both the DAX and the CAC dropped around 0.6 percent, shedding a decent chunk of yesterday’s gains.

“Analysts are expecting January’s UK CPI figure to come in at 2.9 percent, a smidge down from December’s 3.0 percent.

“If accurate, it is going to be interesting to see how investors react to such a minor dip, namely whether or not it sparks another rapid shift lower.

“Though the month-on-month decline would mean inflation is moving in the right direction for those seeking to delay a Bank of England rate hike, 2.9 percent is still very (very) high, and arguably wouldn’t give the hawks at the central bank any reason to re-think their current positions. 

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