The pound euro (GBP/EUR) exchange rate is rising, ending a three-day losing streak run.
The EUR is under pressure as the French government collapsed after PM Bayrou lost a vote of no confidence.
French government bond yields are rising, pushing above yields of government debt in Greece and Italy, typically considered riskier plays.
The pound is rising after British Retail Consortium data showed sales rose 3.1% YoY in August, up from 2.5% in July. However, rising food prices were also responsible for the lift.
UK inflation rose to 3.8% YoY and is expected to rise to 4%. Sticky inflation could limit the BoE’s ability to cut rates.