Investing.com - The pound was little changed against the dollar on Thursday after the Bank of England kept monetary policy on hold, in a widely anticipated decision.
GBP/USD dipped 0.02% to 1.68452 following the announcement, and was moving in a range of 1.6834 to 1.6864.
Cable was likely to find support at around the 1.68 level and resistance at 1.6887, this week’s high.
The BoE’s monetary policy committee voted to keep the benchmark interest rate at 0.5% and maintained the size of its asset purchase program at £375 billion.
The minutes of the meeting are to be published in two weeks time, when investors will learn if the vote was split.
Expectations for a rate hike by the BoE before the end of the year have mounted since it recently indicated that interest rates could rise sooner than markets expect if the economic recovery continues.
The pound ended trading lower against the dollar on Wednesday after data showed that industrial and manufacturing output in the U.K. grew less-than-expected in June.
The soft factory data indicated that the economic recovery in the U.K. is still being mainly driven by the expansion in the country’s dominant services sector.
A report earlier in the week showed that activity in the U.K. service sector accelerated at the quickest pace in eight months in July.
Safe haven demand for the dollar continued to remain supported amid concerns over the economic impact of sanctions against Russia.
In the euro zone, data on Thursday showed that German industrial output rose just 0.3% in June, undershooting expectations for growth of 1.3%. Germany is Russia’s largest trading partner in Europe.
Investors were turning their attention to the European Central Bank’s monetary policy decision and rate statement later Thursday, as concerns over the divergence in monetary policy between it and other major central banks continued to pressure the euro.
The bank was expected to make no changes to policy after it cut rates to record lows in June in an attempt to combat growing deflationary pressures in the currency bloc.
The latest euro zone inflation report showed that the annual rate of inflation slowed to 0.4% in July from 0.5% in June, adding to pressure on the central bank.
Sterling was steady against the euro, with EUR/GBP at 0.7938.