Sterling fell today to a one-week low before paring the losses and trading near the opening, after the dollar reversed lower following the second part of Fed chair Yellen's Congress testimony.
GBP/USD last traded at 1.2456, down from the opening of 1.2465, with an intraday high at 1.2481, and a low at 1.2383.
Sterling's earlier drop came as the dollar rebounded to a five-week high against a basket of currencies, heaping pressure on the pound, specially following strong retail sales and inflation data from America, bolstering the case for another Fed rate hike.
The pound however pared the losses after Fed Chair Yellen didn't mention interest rates in her second day of testifying ahead of Congress, focusing instead of the monetary policy and the economy's conditions, pushing the dollar lower and helping the pound pare losses.
The dollar is dominant overall on the pound due to policy divergence between the Fed, which could raise interest rates again in the March meeting, and the Bank of England, which is likely to keep the current low interest rates and the stimulus program intact.