Sterling remained steady on Wednesday as investors remained split when it came to betting on the Bank of England’s next policy decision due to be debated at its meeting on Thursday.
The British pound remained flat against the U.S. dollar at $1.2782 after slumping to a three-week low on Tuesday. The pound rose 0.1% against the euro to 85.89 pence after hitting a one-week low on Tuesday night.
Investors are largely expecting the Bank of England to hike interest rates again, thereby extending its streak to 14 consecutive hikes. The UK central bank instituted a 50 basis point hike in June.
Markets believe that there is a 63% chance of a 25 basis point hike on Thursday, which would see the BoE interest rate hit a 15-year high of 5.25%. A 37% probability has been given for another 50 basis point rise.