Pound Euro rate and GBP USD up on CPI inflation data

17 May 2011 at 11 AM - Written by John Cameron

STORY LINK Pound Euro rate and GBP USD up on CPI inflation data

The Pound Euro exchange rate (GBP EUR) is 1.1456. The Pound Dollar exchange rate (GBP USD) is 1.6271. The Pound Rupee exchange rate (GBP INR) is 73.172.

The pound euro rate rose on the news that the CPI (UK Consumer Prices Index) annual rate of inflation rose to 4.5% in April.

This figure is up 0.5% over the previous month's 4%, which now leaves CPI at its highest since October 2008.

The inflation increase is likely due to an increase in transport costs around Easter. The Pound Dollar rate also increased on this news.

The Bank of England expects inflation to hit a high of 5% towards the latter part of the year, although has decided not to raise interest rates to fight the rise. The decision is based on the fact that the factors affecting the rises are only temporary.

The Sterling Euro exchange rate also found support after European Union Finance ministers agreed a 78 billion Euro bailout for Portugal yesterday.

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