The pound fell against most major currencies recently after the National Bureau of Statistics announced steady of UK inflation in May growth near to its lowest level since March 2017 despite the sharp rise in oil prices since the beginning of this year.
The consumer price index rose by 2.4% during the period matched market expectations, while core consumer prices "excluding food and energy" rose by 2.1%. Fuel prices were the main driver of inflation growth as food and electricity prices plummeted.
Although inflation growth slowed in May, it is still above the 2% target set by the Bank of England. But expectations for a continued slowdown in inflation growth in 2018 have increased rather than being a temporary phenomenon as the impact of sterling appreciation began to fade.
The fall in inflation led the Bank of England to abandon the May interest rate hike, which weighed on the currency, making markets look forward to the Bank of England meeting in August for a possible future rate hike.
