Pound Advances to One-Week High as U.K. Inflation Accelerates

• Pound Advances to One-Week High as U.K. Inflation Accelerates

The pound advanced against the dollar after a report showed U.K. inflation accelerated more than economists forecast in April.

Sterling jumped as the Office for National Statistics said consumer prices rose 2.7 percent from a year earlier, the fastest pace since September 2013, before paring some of its gains. The Bank of England boosted its inflation forecasts last week, largely attributing the increase to the sharp decline in sterling since the Britain’s European Union referendum.

• GBP/USD climbs 0.3% to 1.2931, after touching 1.2958, the highest since May 10
• The inflation rate, which climbed from 2.3% in March, was higher than the 2.6% economists had forecast
• The U.K. has mandated banks to sell 1.75% 07/2057 gilt, transaction expected to take place on May 16
• Yield on 10-year gilts rose 1bp to 1.15%