Sterling spikes to post-Brexit high as markets price in May rate rise

Up 6.2% since start of the year

Sterling rose to its highest level against the dollar on Tuesday since the UK voted to leave the European Union in June 2016 as investors increased expectations of an interest rate hike at the Bank of England's next meeting in May.

The pound hit an intraday high of $1.438, an increase of 6.2% so far this year and to the highest point since June 2016, despite official labour market data remaining subdued on Tuesday.  According to the Office for National Statistics, annual growth pay rose 2.8% in the three months to February, only 0.1% ahead of the increase in prices for the same period. Sterling's rise has largely been driven by a number of factors including the increased chances of a May rate rise and the UK and the EU agreeing a transition deal last month. Despite holding interest rates at 0.5% at the last m...