Lower than expected inflation brings down pound
Sterling fell yesterday on the back of data showing falling inflation.
The pound now stands at $1.89285, 1.48000 and 219.74000 yen
The Office for National Statistics figures put inflation at 2.4 per cent in July
The fall was said to be down to falls in the costs of financial services as well as air fares and petrol prices, which rose at a slower rate than last year.
Sterling fell on the back of the news as pressures for the Bank of England to up interest rates again this year have subsided.
It is hoped this month's interest rate rise to 4.75 per cent may not have to be repeated this year.
The bank's inflation report last week predicted that inflation would rise in the short-term before falling back towards the two per cent target.
Despite July's inflation fall, fears that inflation could follow this pattern still remain, as producers' higher energy costs could eventually be passed on to consumers, especially as the RPI measure of inflation remained level at 3.3 per cent.- down marginally on all three.- down 0.1 per cent from June.