EUR/GBP (euro/British pound sterling)

Services inflation was estimated to be the biggest driver of price rises, clocking a 3.3% rise. Food, alcohol and tobacco prices also ticked up 3.1%.

The euro is on a tear. It’s climbed to its highest level since late 2021, brushing up against the $1.16 mark.

Despite a generally strong job report, the pound has held close to recent lows.

Higher bond yields would usually support the country’s currency, but there are fears that the rising costs needed to support UK government debt could lead to further tax increases or spending cuts, hindering the chances of an economic recovery. Markets "continue to function in an orderly way" and movements in government borrowing costs were being driven by "a wide range of international and domestic factors," he added.

Inflation below target suggests that the cycle of loosening will probably continue up to summer 2025.