Strong UK Inflation Raises Bet for a Hawkish BOE

Better-than-expected inflation data raised hopes for a BOE rate hike, lifting the British pound. After gaining +0.61% against USD and +0.79% against EUR, GBP has remained firm today. We do not believe strong CPI in August would lead to a rate hike at the upcoming meeting as growth has remained slow while Brexit negotiations are highly uncertain.

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Strong UK Inflation Raises Bet for a Hawkish BOE