The dollar dipped on Friday as new inflation figures from the US indicated that interest rate rises could be coming to an end.

This morning the dollar stood at 1.7561 to the pound and was at 1.2181 against the euro.

Figures from the Labour Department showed that inflation had eased, with the consumer price index rising by just 0.1 per cent.

Even disregarding energy and food costs, inflation was still shown to be relatively low, with other figures from the Commerce Department also suggesting that house prices had begun to slow.

Elsewhere the Philadelphia Federal Reserve Bank said factory activity was down in the mid-Atlantic area, as the economic data prompted some analysts to expect an end to rate hikes in the near future.

In the UK, meanwhile, there was encouraging news in the City, as the FTSE100 broke through the psychologically significant 6,000 barrier for the first time in five years.