UK Inflation Falls, But Why Is The Pound Soaring?

<p>&nbsp;UK inflation continued to show signs of easing in July driven by falling gas and electricity prices.</p><p><br /></p><p>The latest data from the Office for National Statistics (ONS) reported that the UK consumer price index (CPI) rose 6.8% year-on-year in July, down from 7.9% recorded in June.</p><p><br /></p><p>However, the figure was slightly higher than market expectations to rise to 6.7%.</p><p><br /></p><p>This pushed the pound currency up slightly to 1.2750 against the greenback.</p><p><br /></p><p><br /></p><p>Meanwhile, core inflation (excluding food and energy prices) rose 6.9% year-on-year last month, unchanged from June's increase and slightly higher than the 6.8% forecast.</p><p><br /></p><p>Among the factors driving the decline is the drop in gas and electricity prices, as well as the reduced food price inflation.</p><p><br /></p><p>In the meantime, Chancellor Jeremy Hunt said the July figures on the cost of living showed that the government's actions were 'successful'.</p>