The monetary unit of the U.K. lost value on Wednesday for the first day in four trading sessions amid speculation that gains from one day prior were overdone, according to Bloomberg.
The pound is likely to be impacted by the Wednesday commentary of policy maker Martin Weale with the Bank of England (BOE), whose remarks might indicate the body's sentiment regarding interest rates. The Debt Management Office is scheduled to sell 4.5 billion pounds of debt set for maturity in six years later this week.
"The pound has remained relatively well supported despite the renewed dovish message coming from the BOE," states a Wednesday note authored by analysts with Morgan Stanley, according to Bloomberg. "This could be reiterated today with the BOE's Weale giving a speech on forward guidance and its effects. The U.K. industrial production data delivered the expected robust reading yesterday, but the trade balance highlighted a potential longer-term risk for sterling in the form of a continued wide deficit."
The pound dropped about 0.3 percent on Wednesday after Tuesday's close pushed to its top level since August 2011.
The pound's gains on Tuesday were linked with the rosy outlook painted by BOE chief Mark Carney at a speaking engagement Tuesday in New York, according to Reuters.
This material is conveyed as a solicitation for entering into a derivatives transaction.