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The CBI on sterling's strength
Sterling rose against the dollar as news broke that UK inflation hit a four-year low in February, but Alpesh Paleja, Senior Economist at the Confederation of British Industry (CBI) told Saxo TV in London that the pound's strength won't last.
International confidence in the UK recovery has
seen sterling rise 11 percent in the last year, but Alpesh warns investors to bare in mind the currency remains "well below" its pre-crisis peak.
He explains the prospects for sterling will now depend on "relative economic developments" ie how the UK fares compared to its main trading partners. This, in combination with the fact that monetary policy will remain quiet lose, "will no doubt exert some pressure on sterling going forward".
The annual rate of inflation ease to 1.7 percent in
February, its
lowest since October 2009.
Overall, Alpesh remains positive when it comes to UK recovery and expects growth this year to strengthen to about 2.6 percent.
01:38 minutes
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