Euro Slips as UK Inflation Rises to 2.9%

The Euro pared its gains against the British Pound on Wednesday after data showed UK inflation rose to 2.9% in July, matching market expectations.

The Office for National Statistics reported that the Consumer Price Index (CPI) increase was driven by a 'sharp rise' in gas prices following an increase in the household energy price cap.

Core CPI, which excludes volatile food and energy items, rose 2.6% year-over-year in July, exceeding forecasts of 2.5%

The UK's inflation data did little to shift market expectations for a Bank of England interest rate hike by the end of the year, with money market pricing indicating a one-quarter percentage point increase in the Bank Rate from 3.75% to 4.0%