Sterling remained stable Wednesday as investors assessed economic risks and monitored developments influencing global markets and energy prices.
The pound traded little changed against the dollar at $1.3402, reflecting a cautious market tone amid shifting macroeconomic expectations.
Oil prices declined notably, offering some relief to inflation pressures that have recently unsettled financial markets.
UK inflation held at 3% in February, aligning with expectations, though analysts warn the outlook has shifted significantly in recent weeks.
Economists noted that earlier data may no longer reflect current conditions, as rising energy costs begin to reshape inflation trajectories.
Business activity data showed slowing growth, with input costs rising at the fastest monthly pace in decades, signaling mounting pressure on firms.
Interest rate expectations have adjusted sharply, with markets now pricing a strong احتمال of a Bank of England rate hike in April.
However, some analysts remain skeptical, citing weak growth and limited wage pressures as factors that could restrain aggressive monetary tightening.
