Inflation in the United Kingdom jumped 2.5% year-on-year in June, the highest since August 2018, the Office for National Statistics (ONS) announced today, led by fuel, food, clothing and restaurants. These sectors all benefitted from easing Covid-19 restrictions.

This surge in inflation does not seem to worry the Bank of England too much, with Andrew Bailey stating that the institution will monitor this rise, but without overreacting. The BoE estimates that inflation will rise to 3% by the end of the year.

Investors are also cautious today, ahead of Federal Reserve (Fed) Chairman Jerome Powell's hearing before the House of Representatives and a new round of U.S. bank results.

 

Source: Berenberg

 

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