Investors cut bets on UK interest rate rise after surprise fall in inflation – as it happened

Odds of an increase in UK interest rates on Thursday fall below 50%, after inflation rate dropped unexpectedly in August to an 18-month low

• Full story: Inflation fall gives Bank of England knife-edge interest rate decision
• UK inflation: which goods and services have changed most in price?

The pound has dropped to its lowest level in almost four months, following August's welcome drop in inflation.

Sterling has shed half a cent against the US dollar to hit $1.2335, the lowest since late May.

British inflation unexpectedly eased from 6.8% to 6.7% in August, and core inflation fell from 6.9% to 6.2%.

The surprise fall in UK inflation triggered a kneejerk selloff in sterling, as today's data cements the expectation that the Bank of England's (BoE) next rate hike could also be its last.