Investing.com – The pound rallied to a fresh 14-month high against the U.S. dollar on Tuesday, after a report showing that consumer prices in the U.K. rose to a 28-month high in February buoyed expectations for a near-term rate hike by the Bank of England.
GBP/USD hit 1.6402 during European early afternoon trade, the pair’s highest since January 19, 2010; the pair subsequently consolidated at 1.6388, gaining 0.49%.
Cable was likely to find support at 1.6202, Monday’s low and short-term resistance at 1.6514, the high of December 7, 2009.
Earlier in the day, the U.K. Office for National Statistics said consumer price inflation rose to 4.4% in February from 4.0% the previous month, outstripping expectations for a 4.2% gain.
Higher housing costs, domestic heating bills and clothing prices drove the increase in CPI, the ONS said.
The pound has rallied this year on the view that the BoE will increase interest rates but uncertainty remains over the timing due to the uneven nature of the U.K. economic recovery.
The pound was also higher against the euro, with EUR/GBP shedding 0.36% to hit 0.8690.
Also Tuesday, a separate report showed that U.K. public sector net borrowing totaled GBP10.2 billion in February, up from GBP8.1 billion for the same month in 2010 and above forecasts for total borrowing of GBP8.0 billion.
GBP/USD hit 1.6402 during European early afternoon trade, the pair’s highest since January 19, 2010; the pair subsequently consolidated at 1.6388, gaining 0.49%.
Cable was likely to find support at 1.6202, Monday’s low and short-term resistance at 1.6514, the high of December 7, 2009.
Earlier in the day, the U.K. Office for National Statistics said consumer price inflation rose to 4.4% in February from 4.0% the previous month, outstripping expectations for a 4.2% gain.
Higher housing costs, domestic heating bills and clothing prices drove the increase in CPI, the ONS said.
The pound has rallied this year on the view that the BoE will increase interest rates but uncertainty remains over the timing due to the uneven nature of the U.K. economic recovery.
The pound was also higher against the euro, with EUR/GBP shedding 0.36% to hit 0.8690.
Also Tuesday, a separate report showed that U.K. public sector net borrowing totaled GBP10.2 billion in February, up from GBP8.1 billion for the same month in 2010 and above forecasts for total borrowing of GBP8.0 billion.