Pursuits
Pound Falls to Eight-Month Low as Inflation Rate Turns Negative
- New BOE official Vlieghe says growth is solid, `not fantastic'
- Markets pricing first BOE rate increase beyond Dec. 2016
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The pound touched the weakest level versus the euro since February as Britain’s inflation rate unexpectedly turned negative for the second time since 1960 in September, strengthening the case for the Bank of England to delay raising interest rates.
Sterling dropped versus 12 of its 16 major peers, posting its steepest decline against the dollar in almost three weeks. BOE policy maker Gertjan Vlieghe said inflation risks are skewed to the downside and that price growth needs to pick up before he will vote for a rate increase. His comments to U.K. lawmakers were his first public remarks since joining the Monetary Policy Committee last month.