UK interest rates unchanged as economy improves

The pound touched a one-month high against the dollar as Bank of England governor Mark Carney and his fellow policymakers left their main interest rate at a record low amid the backdrop of an improving economy.

Sterling stayed weaker against the euro after the BoE kept the benchmark interest rate at 0.5%, as predicted by all 47 economists surveyed by Bloomberg.

UK government bonds reversed an earlier advance that followed the European Central Bank deciding to curb access to funding for Greece’s financial institutions, fuelling demand for haven investments like gilts. Slower inflation around the world, helped by collapsing oil prices, has prompted peers from Canada to Australia to loosen their monetary policy this year as the BOE holds steady.