Sterling drifts lower as traders question prospect of interest rate hike

Sterling fell against the US dollar despite Bank of England Governor Mark Carney telling MPs that a rate hike may be needed over the coming months.

London Stock Exchange

By Ben Woods, Press Association Chief City Correspondent

Sterling rolled back against the US dollar on Tuesday as currency traders mulled the prospect of interest rates being kept on hold next month.

The pound was down 0.5% versus the greenback at 1.31 despite Bank of England Governor Mark Carney telling MPs that a rate hike may be needed over the coming months to tackle surging inflation.