This morning's release of October CPI data could be read as mildly hawkish for Bank of England policy, ING's FX analyst Chris Turner notes.

GBP to remain fragile heading into the Budget

"He highlights: 'Headline inflation was a tad above consensus at 3.6% on account of a sharper rise in food prices than we and others had been pencilling in. Last month, food inflation fell back from 5.1% to 4.5%, which did look a little too good to be true. That has bounced back up to 4.9% and remember this is something the BoE hawks are fairly obsessed with at the moment, out of concern it will fuel inflation expectations'."

"Overall, however, he doubts today's data will be a game-changer for key BoE swing-voter Andrew Bailey, and still favours a 25bp December rate cut. The proximity of next week's Budget is probably another reason why sterling could not hold its initial gains on today's release. We expect sterling to remain fragile heading into the Budget."