Investing.com - The pound was little changed against the dollar on Wednesday, ahead of the release of the Bank of England’s quarterly inflation report, amid expectations that the bank will update its forward guidance policy.
GBP/USD touched session highs of 1.6475 and was last up 0.02% to 1.6453.
Cable was likely to find support at 1.6381, Monday’s low and resistance at 1.6566, the high of January 30.
The BoE 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.
Data last month showed that the U.K. unemployment rate dropped to 7.1% in the three months to November, to stand just above the 7% threshold at which the BoE has said it would start to consider raising interest rates.
BoE Governor Mark Carney has since indicated that rate hikes are not imminent, as the economic recovery is not strong enough to support a tightening of monetary policy.
Demand for the dollar continued to be underpinned after Federal Reserve Chairwoman Janet Yellen confirmed Tuesday that the U.S. central bank is on track to reduce its stimulus program.
In her first Congressional testimony since her appointment as Fed Chair, Ms. Yellen told the House Financial Services Committee that the central bank would continue to gradually reduce the pace of its asset purchase program.
She also reiterated that the Fed plans to hold interest rates at zero “well past” the time the jobless rate falls below 6.5%.
Elsewhere, sterling was fractionally higher against the euro, with EUR/GBP dipping 0.05% to 0.8285.