The pound rose to its highest level in two weeks against the dollar on Tuesday after a senior Bank of England official said UK interest rates should be raised again without delay.
GBP/USD was up 0.32% to 1.4174 by 05:39 AM ET (09:39 AM GMT), the most since March 28.
The pound climbed after BoE monetary policy committee member Ian McCafferty said the prospect of faster pay rises and a strong pick-up in the global economy emphasized the need for higher borrowing costs before long.
In an interview with Reuters McCafferty said that wage growth, which has lagged inflation for much of the past decade, could prove to be stronger than many of his colleagues on the monetary policy committee believed.
“We shouldn’t dally when it comes to tightening policy modestly,” McCafferty said.
McCafferty was one of the two policymakers who voted for a rate hike last month.
The BoE raised rates for the first time in nearly a decade in November and in February indicated that rates would need to rise again in the coming months, possibly as soon as May.
Sterling was also higher against the euro, with EUR/GBP down 0.26% to 0.8695.