Sterling burst through $2 this week for the first time since September 1992 when the pound was ejected from the European exchange rate mechanism on “Black Wednesday”.

A perfect storm of inflationary surprises set the pound on its way, as stronger producer prices than expected on Monday were followed on Tuesday by UK consumer price inflation hitting 3.1 per cent, more than 1 percentage point higher than the Bank of England’s 2 per cent target.