Sterling rose in European trade against dollar for second straight session on prospects of a rate hike in the UK following strong inflation data.
GBP/USD rose 0.2% to 1.3637, with an intraday low at 1.3604, after closing up 0.15% yesterday, the first profit in four days following strong consumer prices data in the UK.
The dollar index fell 0.1% on Thursday, the second straight session against a basket of major rivals.
US 10-year treasury yields stopped spiking ahead of further data on rate hike prospects in the US in March.
In the UK, consumer prices rose 5.4% in December, the fastest such pace since March 1992, passing estimates of 5.2%, after rising 5.1% in November.
The data increased inflationary pressures on UK policymakers and bolstered prospects of rates a hike in February.