The pound has climbed to its highest overall level since the 2016 Brexit referendum. Sterling has gained against the euro and the dollar ahead of an expected interest rate decision from the Bank of England.
Sterling reached its joint highest level since the June 2016 referendum this week, according to Bank of England figures. The measure tracks the pound against a basket of 18 of the world's main currencies.
The index hit 86.4, where 100 equals the value in 2005. The Bank will officially confirm the calculation on Thursday.
Sterling has risen notably in recent weeks against the euro and the dollar, ahead of an expected rise in interest rates.
Some traders said the UK is being seen in a different light given relative political stability, solid growth and the rapprochement with the European Union. Economist and former Treasury minister Jim O'Neill said, according to the BBC: "People were, and to a lesser extent, are, underestimating the improving momentum in the UK"
The pound fell significantly after the referendum and reached further lows during the Brexit process, the Covid pandemic and the 2022 mini-Budget.
A stronger pound can help rein in inflation and increase buying power for consumers on imports and on holidays. But UK growth so far this year has outperformed all expectations, and there are signs that higher energy and fuel prices have now hit consumer confidence.
The Bank's nine-member Monetary Policy Committee faces an important decision on interest rates on Thursday, with the first rise in three years widely expected.
Source: BBC News
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