The new GBP15 billion ($19 billion) cost-of-living support package is seen as having less than a 1 percentage point impact on inflation, UK Finance Minister Rishi Sunak seen in an interview with Sky News on Friday.

Key quotes

"My view is that it will have a minimal impact on inflation,"

Asked if it would be a one percentage point impact, he said: "Much, much less than that."

Asked about a possible windfall tax on electricity generators, "What we want to do and we are going to do urgently is understand the scale of those profits, and then decide on the appropriate next steps."

Market reaction

GBP/USD is paring back gains above 1.2600, as risk-on flows cool off a bit and the US dollar recovers. The pair is currently trading at 1.2614, up 0.17% on the day.