Investing.com - The pound ticked up to session highs against the dollar on Wednesday, boosted by a slightly more hawkish tone in the Bank of England’s May meeting minutes, but gains were held in check as the greenback remained broadly stronger.
GBP/USD ticked up to highs of 1.5536 from around 1.5500 ahead of the minutes.
The minutes showed that the Monetary Policy Committee was unanimous in voting to keep rates on hold this month and its quantitative-easing program unchanged.
The MPC voted 9-0 to keep interest rates at 0.5%.
According to the minutes, two MPC members saw the decision as "finely balanced", while all members agreed that rates more likely than not to go up over the next three-year period.
"While there was a range of views over the most likely future path for Bank Rate, all members agreed that it was more likely than not that Bank Rate would rise over the three-year forecast period," the minutes said.
The BoE also believes that U.K. economic growth will accelerate in the second quarter, with lower inflation boosting incomes, after the economy expanded just 0.3% in the first quarter of the year.
The minutes reiterated the banks view that record low inflation rates are not likely to continue for long and that consumer prices will pick up notably towards the end of the year.
Data on Tuesday showed that the U.K. entered into negative inflation in April for the first time since 1960, with the annual rate of inflation falling 0.1% after remaining flat in the previous two months.
Elsewhere, sterling was higher against the euro, with EUR/GBP down 0.29% to 0.7162.
The euro remained under heavy selling pressure as concerns over the prospects of a Greek default weighed ahead of a critical June 5 deadline for Athens to reach a deal with its creditors.
Earlier Wednesday a Greek government official warned that Athens will be unable to make a €305 million payment to the International Monetary Fund due on June 5 if a deal is not reached by then.
The dollar remained broadly stronger after upbeat U.S. housing data on Tuesday boosted hopes for a rebound in second quarter economic growth after a sharp slowdown in the first three months of the year.
Investors were looking to the minutes of the Federal Reserve’s April meeting, due for release later Wednesday, for fresh indications on the timing of an initial rate hike.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.22% to 95.58.