Sterling rallies past 1.35 in American trade

Sterling rose against the dollar following a spate of data from Britain and the US, with short-covering playing a part after recent tumbles, while markets price in the Federal Reserve's policy decisions yesterday.

As of 04:32 GMT, GBP/USD rose 0.41% to 1.3550 from the opening of 1.3494, with an intraday high at 1.3567, and a low at 1.3471. 

Earlier UK data showed net public borrowing rose to 5.1 billion pounds, compared to a 1.3B drop in July, revised from a 0.8B fall, while analysts expected a 6.5B increase. 

In his Washington speech earlier this week, Carney asserted again that policy tightening could be required in the next few months, noting that the monetary policy could be altered on par with the possibilities of increasing interest rates back to their normal levels, noting that Brexit is expected to leave inflationary side effects. 

Otherwise, earlier US data showed a drop in unemployment claims, while the Philly manufacturing index widened unexpectedly in September, as the house price index accelerated below expectations in July.  

Yesterday, Federal Reserve policymakers voted to hold overnight interest rates unchanged at between 1.00% and 1.25% in line with expectations in today's Federal Open Market Committee meeting, while announcing the start of the process to normalize the balance sheet from October.