Sterling Soars Amid Thin Pre-Christmas Trading

The pound reached a three-month high against a weaker dollar and its strongest point in two months against the euro. Trading was thin ahead of Christmas, influenced by last week's Bank of England meeting. The BoE cut interest rates, hinting at a slower pace of future reductions.

The pound showcased strength as it hit a three-month peak against a softer dollar and saw its firmest standing against the euro in two months.

On Wednesday, early trading saw sterling inch up to $1.35335, its highest since mid-September, although it later stabilized just below this mark.

With the Christmas holidays nearing, many traders were absent, leading to thin trading. The market was still reacting to last week's Bank of England meeting, where a decision to cut interest rates hinted at potential slower rate reductions in the future, providing continued support for the pound against other currencies, especially the dollar.

(With inputs from agencies.)