Monday May 12, 10:02 AM
Forex - Pound jumps after record-high producer prices
LONDON (Thomson Financial) - The pound was boosted against other currencies by the release of data on UK producer prices, which soared at the fastest pace on record in April.
Input prices rose 2.4 percent, well above analyst forecasts
of a 2.0 percent rate, for a big 23.0 percent annual gain. Output prices were up 1.4 percent on the month, double expectations for just 0.7 percent. All the figures were the highest since records began in 1986.
Meanwhile, the trade data was better than expected, with the deficit narrowing to 7.4 billion pounds in March from 7.6 billion in February.
The data comes ahead of key consumer price inflation figures on Tuesday, all of which will have fed into the Bank of England's Inflation Report, due Wednesday. Analysts expect the report to signal that interest rates will be cut only gradually because of price pressures.
The data pushed the pound up to $1.9560 from $1.9500 before the release of the data. It also gained against the euro, pushing it down to 0.7890 pounds from 0.7905 pounds.
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