Consumer Price Index data showed that the annual inflation rate has fallen from 3.5% in January to 3.0% in February. This figure is slightly better than expectations which were 3.1%. It seems that despite the fall of the pound and the VAT hike in January, upward price pressure in the UK has remained subdued. This data helps affirm the Bank of England's stance that inflation should be moderate in 2010 (towards its annual target of 2%).

Ahead of Today's annual budget release, the GBP rose against the USD to 1.4980 before retracing.