Ammon News - The dollar edged higher on Wednesday as investors awaited Federal Reserve meeting minutes for more insight on the central bank's rate path, while the pound jumped after data showed UK inflation fell less than expected in April.

The dollar index was 0.05% higher against a basket of currencies at 104.70, bobbing above a five-week low of 104.07 touched last week.

The pound jumped as UK inflation neared the BoE's target in April, but did not slow as much as expected, prompting investors to pull bets on a rate cut next month.

British consumer prices rose by 2.3% in annual terms in April, slowing from a 3.2% increase in March. The BoE and economists polled by Reuters had forecast an annual rate of 2.1%.

Money markets now see only a 13% chance of a rate cut in June, according to LSEG data. Earlier this week, pricing in derivatives markets suggested traders saw a 55% chance of a first cut coming in June.

Sterling rose 0.16% to $1.2730, after touching a two-month high of $1.2761. The euro fell against the pound to two-month lows and was last down 0.23% on the day at 85.21 pence.

Reuters