Great Britain Pound: Last night the UK recorded it highest annual CPI since 2008 as it emerges from its worst recession in decades. Annual headline CPI rose 3.5% in line with expectations and British retail prices also grew in line with market expectations at 3.7%. Although the gains are expected to be temporary as the BOE reinforced its commitment to keep inflation at the Government’s target rate of 2% and would “continue to monitor the appropriate scale of the asset purchase program and further purchases would be made should the outlook warrant them.” The Pound rallied from its overnight low of almost 1.5625 in US trade testing 1.58 USD several times after faster-than-estimated growth in New York manufacturing and positive comments out of Europe spurred optimism the global economic recovery will be sustained, increasing risk appetite. The Sterling opens near its high at 1.5785 USD and 2.2330 against the NZD.
- I expect a range today in the GBP/NZD rate of 2.2250 to 2.2400
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