Published On: Tue, Sep 12th, 2017

Pound to euro live: Sterling rises ahead of interest rate decision by Bank of England | City & Business | Finance

Sterling hit 1.10 against the euro on Tuesdday, as markets prepare for an update on inflation, employment and finally the September interest rate decision from the Bank of Englad.

The pound could rise if more than two members of the Bank’s Monetary Policy Committee (MPC) vote for the base rate to rise from its current level of 0.25 per cent.

The decision will be influenced by the latest inflation figures, released today, and employment data out on Wednesday.

The Bank of England has previously signalled limited tolerance for high inflation and a big jump could raise the chance of more members voting for an interest rate rise.

At the same time, strong employment data and rising wages would signal that the economy is still strong and supports the rationale for hiking rates. 

Michael Hewson, chief market analyst at CMC Markets UK, added: “It’s set to be a big week for the pound with the release of the latest inflation and wages data, amidst concerns that the recent rise in inflation may yet deliver a final kick to the UK consumer.

“There is evidence that wage growth might well be starting to bottom out, which this week’s numbers might well corroborate further.
 
“An improvement in wages could well add further weight to the arguments being made by the Bank of England MPC member Michael Saunders and his calls to reverse last year’s emergency rate cut.”

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