Threat of global inflation and rate hikes inch closer to home        

Federal Reserve believes price hikes and inflation pressures may be here to stay

Market watchers were caught out by the hawkish comments released by the US Federal Reserve about inflation and wage growth that might lead it to hiking interest rates in response. 

The threat of global inflation inched closer to home today as experts wait to see whether the ECB will hold out in its "fascinating" battle to keep mortgage and business interest rates from rising this year. 

The implied cost for the Government to borrow from international debt markets rose with the yield on its 10-year bond increasing to 0.34%, along with most other sovereign governments in Europe.