Investing.com - The pound fell to session lows against the broadly stronger dollar on Wednesday after the minutes of the Bank of England’s latest meeting showed that officials believe a rate hike could leave the economy vulnerable to shocks.
GBP/USD was down 0.56% to 1.6022 from around 1.6069 ahead of the minutes.
The minutes of the BoE’s October meeting showed that two policymakers voted in favor of hiking rates to 0.75%, while seven voted in favor of keeping rates on hold at 0.5%.
Most monetary policy committee members said there was not enough evidence of inflationary pressure to justify a rate hike, pointing to weak wage growth and signs that the rate of the economic recovery is cooling.
Many MPC members also felt that raising rates would leave the U.K. vulnerable to shocks in the global economy.
"Further downside news in the euro area had increased the risks to the durability of the UK expansion had increased risks to Britain’s economy”, the minutes said.
Demand for the dollar continued to be underpinned ahead of U.S. inflation data for September due out later in the day, amid heightened expectations that the Federal Reserve is growing closer to raising interest rates.
Elsewhere, the euro rose to session highs against sterling, with EUR/GBP up 0.29% to 0.7914 from around 0.7900 before the release of the BoE minutes.
The euro’s gains were held in check amid speculation that the European Central Bank is considering expanding its bond purchasing stimulus program.
The euro weakened against the other major currencies on Tuesday after Reuters reported that the ECB is considering buying bonds issued by companies, or corporate debt, to help shore up the ailing euro zone economy.