December's inflation increased to 1.6% as measured by the Consumer Prices Index or CPI (HERE). The old RPI measure rose to 2.5%. This is more than was forecast by economists and is a portent of things to come. It overshadows Mrs May's speech later today on the main negotiating points for brexit and will probably affect the pound which recovered a little of yesterday's losses overnight.
On the news it was trading almost one percent up on last night's close. I assume traders think this will lead eventually to a rise in interest rates. Not good new for those in debt.
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