Sterling surges on rate alert

Sterling jumped as much as 1.2% against the euro after the Bank of England said interest rates probably needed to rise sooner and by a bit more than it had previously thought because of the strength of the global economy.

Market interest rate futures now project a 60% chance of a Bank of England rate hike in June and fully-price in an increase in August meeting. The central bank’s Monetary Policy Committee raised interest rates for the first time in a decade in November.