British pound reaches 1-month low on mild UK inflation data

The British pound declined to a one-month trough versus the euro Tuesday, affected by data showing UK inflation plunged to zero last month, its weakest since records started, amplifying speculations interest rates would remain low. 

Sterling slid 0.5% to 73.715 British pence per euro, its lowest since February 23. Against the US dollar, it erased 0.5% to $1.4874, trading at $1.4945 before the release of inflation report. 

Britain's CPI dropping dangerously near inflation territory during February would “no doubt strengthen the Bank of England's already tough views on weak price pressures," said Jameel Ahmad, Chief Markets Analyst at FXTM. 

Last week, Bank of England Chief Economist Andy Haldane said the central bank should be prepared to reduce rates further in the event inflation seemed staying below its 2% target.