TOKYO, April 19 Reuters Data showing British inflation stayed above 10 in March meant the pound climbed against the dollar while other currencies dipped, with the greenback underpinned by a tickup in U.S. yields.

Sterling was last 0.25 higher at 1.2454, heading back to last week39;s 10month high, after data showed British consumer price inflation eased by less than expected in March to 10.1 from February39;s 10.4.

Britain now has western Europe39;s highest rate of consumer inflation.

This fact, along with the stronger than expected wage growth data yesterday, provide compelling reasons for the BoE to now hike by 25bps at the next meeting on 11th May, said Derek Halpenny head of research, global markets EMEA at MUFG in a note to clients.

However, he added With the Fed expected to hike in May and the ECB to hike by more over the coming months, the positive impetus from this data for the pound will likely be contained.

Expectations for higher official rates in a market relative to those elsewhere typically drag money market and government bond yields higher, attracting cash into a country while boosting its currency.

The pound also strengthened a little against the euro, with the common currency down 0.3 to 88.03 pence.

In broader markets the dollar index , which gauges the greenback against six major peers, ticked up 0.22 to 101.94 after a choppy few days. On Friday, the index had dipped to a oneyear low at 100.78.

Among major currencies, the dollar39;s largest…