Sterling hovers near three-week low ahead of major UK data

Sterling declined in European trade against a basket of major rivals, extending losses for the second day against dollar and almost hitting three-week lows ahead of important UK data and a hearing session in parliament about Bank of England's monetary policy report. 

The greenback headed to two-month highs anew following bullish remarks by Fed officials, which renewed prospects of a 0.25% rate hike in June.

GBP/USD fell 0.3% to 1.2401, with a session-high at 1.2447, after losing 0.1% yesterday, resuming losses after a recovery yesterday from three-week lows at 1.2391.

Major Sectors

A batch of important data on major UK sectors will be released today, which will help determine the chances of upcoming  interest rates hikes by Bank of England in June. 

Hearing Sessions

And later today, the UK Parliament is holding a hearing session on Bank of England's monetary policy report, which will again include important clues on the path ahead for UK policies and interest rates.

The Dollar

The dollar index rose 0.2% on Tuesday for another session, almost hitting two-month highs at 103.62 against a basket of major rivals. 

A batch of bullish remarks by Fed officials bolstered the case for another interest rate hike in the US at the June 13-14 meeting.

Minneapolis Fed President Neil Kashkari said that US interest rates might move above 6% for inflation to fall below 2%, while Saint Louis Fed President James Bullard said the Fed might need to raise interest rates by another 0.5% this year. 

Such remarks boosted chances of a Fed 0.25% rate hike in June from 13% to 30%.