Investing.com - The pound pushed higher against the U.S. dollar on Tuesday, after new Federal Reserve Chair Janet Yellen said that the central bank was likely to continue tapering its monthly bond-buying program in measured steps.
GBP/USD hit 1.6474 during U.S. morning trade, the pair's highest since January 31; the pair subsequently consolidated at 1.6470, gaining 0.42%.
Cable was likely to find support at 1.6367, the low of January 14 and resistance at 1.6498, the high of January 31.
In prepared remarks to the House Financial Services Committee, Fed Chair Yellen said that the central bank would taper the pace of its asset purchases at future meetings if the economy continued to improve as expected.
“Let me emphasize that I expect a great deal of continuity in the Federal Open Market Committee’s approach to monetary policy,” she said.
She added that the pace of the central bank’s bond purchases are not on a “preset course”, while reiterating that Fed plans to hold interest rates at zero “well past” the time the jobless rate falls below 6.5%.
Ms. Yellen said that "the recovery in the labor market is far from complete," despite progress made in the last year, with the unemployment rate, currently at 6.6%, still "well above levels" that Fed officials consider sustainable by a healthy economy.
Markets were also turning their attention to the Bank of England’s quarterly inflation report, due for release on Wednesday.
The bank was widely expected to announce adjustments to its forward guidance policy after recent data showed that the U.K. unemployment rate has fallen more quickly than the bank anticipated.
Sterling was higher against the euro, with EUR/GBP slipping 0.19% to 0.8298.