In London trading the pound was markedly higher after a surge to a 2 1/2 month high versus the euro. The pound also rose to a two-month high against the dollar, which was reportedly inspired after the Bank of England hiked interest rates to 4.75%, a quarter point jump that was completely unexpected. Only five of the 35 analysts polled by AFX news were predicting a rise. The hike was necessary to bring the annual CPI rate of inflation back to 2.0%, the target level, according to a statement released by the Bank of England. A background of firm growth, limited spare capacity, and inflation above target further made the hike a surprise move.