Investing.com - The pound re-approached recent 15-month highs against the U.S. dollar on Wednesday, boosted by strong UK retail sales data, while caution ahead of the Federal Reserve's upcoming policy statement maintained downward pressure on the greenback.
GBP/USD was up 0.64% at 1.3589 by 04:40 a.m. ET (07:40 GMT), re-approaching Monday's 15-month peak of 1.3620.
The pound moved higher after the UK Office for National Statistics reported on Wednesday that retail sales blew past forecasts in August, increasing 1.0%.
Year-on-year, retail sales climbed 2.4% last month, also better than expectations.
Sterling had come under some pressure after Bank of England Governor Mark Carney warned on Monday that Brexit will weigh on overseas trade and that leaving the EU was already limiting the potential size of the UK economy.
However, Carney also said that interest rates are likely to rise “over the coming months”, reiterating what was said at the BoE's most recent policy meeting and had already pushed the pound broadly higher.
Meanwhile, sentiment on the greenback remained fragile as investors awaited the outcome of the Fed's monthly policy meeting.
The U.S. central bank was widely expected to leave interest rates on hold, but it was also likely to announce plans to trim its $4.2 trillion in bond holdings.
Sterling was also higher against the euro, with EUR/GBP down 0.50% at 0.8839.