The pound sterling climbed against other major currencies after the UK released inflation figures that surpassed expectations. Market analysts are now predicting a higher likelihood of the Bank of England raising interest rates in the near future. This anticipation is driving increased demand for the pound on the foreign exchange market, resulting in its appreciation.

The unexpected surge in inflation is attributed to rising energy costs and increased consumer spending. The Bank of England’s Monetary Policy Committee will carefully consider these factors when making its next interest rate decision. Higher interest rates typically attract foreign investment, further bolstering the value of a currency.