Pound Rises Most in 3 Months

The pound roared toward the cycle high even after Carney moved the goalposts on forward guidance. GBP was easily the top performer while the euro lagged. The Australian dollar stalled ahead of the January jobs report.

Carney struck a dovish tone in comments on Wednesday saying he won't take any risks with the recovery, a signal that he's not eager to hike rates. The market was focused on the BOE inflation report and its higher economic projections.

Cable jumped on the report in European trading but continued higher through US and Asian trading, hitting 1.6619, less than a half-cent from the January cycle high.

Otherwise, US trading was muted as the euro consolidated a fall after Coeure strongly hinted at negative deposit rates. Yen trading was lackluster as risk sentiment and the S&P 500 were flat.

One thing that's thankfully off the agenda for more than a year is the US debt ceiling after the Senate voted to lift it until March 2015. Yellen's scheduled testimony for Thursday has also been postponed due to a US winter storm.

The Australian dollar was on a roll heading into US trading as it rose to a one month high at 0.9067 but the gains disappeared with traders cautious ahead of the January employment report. Numerous jobs reports have disappointed in the past year and the market is looking for 15K jobs gains in this one, which is due at 0030 GMT. This report includes benchmark revisions so it could be especially messy.