The English pound slipped in value Tuesday, following the downward trend set by stock prices as inflation accelerated in the U.K., Bloomberg reports.
As Bank of England Governor Mervyn King prepared to speak Tuesday afternoon, the pound fell against the Japanese yen but the monetary unit climbed in value when compared with the shared currency of the European Union. The consumer price index increased 5.2 percent last month as compared to September 2010, the National Statistics Office in London stated.
"Euro/sterling looks much like a chart of euro/dollar and is also pretty similar to the stock market charts," research director Kathleen Brooks with Forex.com told Reuters. "The main driver is risk appetite, not the fundamentals of the UK and euro zone economies. Euro/sterling didn't really react to UK CPI or the German ZEW data."
King, who has said economic conditions in the U.K. are hovering around the lowest point since the 1930s, is forecast to strike a dovish tone.
As the European Union meeting approaches this Sunday, various developments leading up to it are likely to influence the value of both the pound and the euro.
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