The pound is flat in forex trading today (January 10th) after it was declared the way the Retail Prices Index (RPI) is calculated will remain the same.
This morning, the Office for National Statistics (ONS) said the current measure should continue to be used for long-term indexation and index-linked gilts and bonds without being changed in any significant way.
However, the ONS research programme recently found that the RPI formula in its current form causes a gap between estimates produced by the RPI and the Consumer Prices Index and a new measure needs to be used from March 2013 with a different formulation known as the RPIJ.
Any decision to alter the current RPI so that it rises more slowly would have reduced the future pension increases of millions of private sector pensions.
At 10:00 GMT, the pound rose by 0.1 per cent against the dollar to £1 buying $1.604, while it made marginal losses versus the euro to €1.225.
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