 Sterling fell broadly today after UK’s February CPI came in slightly below expectations. However, the selloff has been contained, with markets still expecting the BoE to proceed cautiously with policy easing. In particular, services inflation remained sticky at 5%, signaling that underlying price pressures are not abating as quickly as hoped. Some economists argue that February’s inflation dip may prove to be a false dawn. The scheduled rise in energy bills and national insurance contributions next month could push inflation back towards 4% level again, undermining hopes of sustained disinflation. Against that backdrop, BoE is unlikely to accelerate the pace of rate cuts. Markets still see a 25bps rate reduction as a realistic outcome for BoE’s next meeting in May. That would align with the central bank's previously communicated strategy of a cautious and gradual easing path, one cut per quarter. On the day, Sterling is the weakest performer among major currencies, followed by Yen and Swiss Franc. Commodity currencies continue to lead with Kiwi topping the chart. Dollar and Euro are positioning in the middle of the pack.... | 
