Investing.com - The pound jumped Wednesday after hawkish remarks by the Bank of England’s chief economist Andy Haldane.
Sterling was up 0.51% at $1.2695 at 08:15 ET after a high of $1.2708.
Earlier sterling fell to an intraday low of $1.2590 as the Conservatives remained in talks with the Democratic Unionist Party of Northern Ireland to form an alliance to allow it to govern.
Prime Minister Theresa May earlier Wednesday presented her legislative agenda in the Queen's speech with the emphasis on Brexit talks.
“The balance of risks associated with tightening too early, on the one hand, and “too late”, on the other, has swung materially towards the latter in the past six to nine months,” Haldane said. Haldane said he considered a rate hike in June.
Consumer price inflation has jumped well above the Bank of England’s 2% target as a result of the depreciation of the pound.
“Provided the data are still on track, I do think that beginning the process of withdrawing some of the incremental stimulus provided last August would be prudent moving into the second half of the year.” Haldane added.
Three Bank of England Monetary Policy Committee members dissented against the bank’s decision last week to hold its bank rate at an historic low of 0.25% and maintain its quantitative easing program.
Governor Mark Carney said earlier this week he felt it was not the right moment for the Bank of England to tighten policy.