Due to soaring food and fuel prices, the UK CPI comes out at 3.8% from the previous 3.3%. This was forecast at 3.6%. This is the highest CPI release since June of 1992.

The CORE CPI comes out at 1.6% from the previous 1.5%. This was forecast for 1.5% once again.

This data gave the already surging GBP a serious push of about 40 PIPS vs the USD which lasted only briefly then reversed back to pre-data levels.

As the UK is in a situation where economic growth is slowing and inflation is rising, this inflation/CPI data disputes any argument for a near-term interest rate cut. "The Bank of England can't cut rates until it is convinced that inflation is moving downwards" said James Knightly from ING.