Pound gains on inflation comments

Pound gains on inflation comments

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The pound gained on the US dollar, the euro and the yen Thursday after a Bank of England official said that the Bank needs to keep inflation as its main focus when deciding policy after new data showed that UK inflation was up to 4.7 percent in August.

In morning trade in New York, the pound traded at 79.32p to the euro while it took $1.8482 to buy a pound and the yen was at ¥196.4957 to the UK currency.

The Swiss franc also strengthened versus the greenback and the euro as investors were attracted to the currency that has long been considered a safe haven in times of economic uncertainty on concerns about the outcome of negotiations over the US government’s plan to bail out its financial sector.

At nearly 11 a.m. in New York, the Swiss franc traded at SFr1.0854 to the US dollar and at SFr1.5913 to the shared currency.

The Canadian dollar also gained on its US counterpart on concerns that an agreement between the Bush administration and Congress on the bailout plan could be delayed, with the loonie trading recently at C$1.0353 to the greenback.

The US dollar was also hurt by growing sentiment that the Federal Reserve will cut interest rates when it meets next in October.