FX round-up: Cable notches one-month high ahead of Brexit bill, White Paper and BoE

Cable continued to rise even as the Greenback did the same ahead of the result of the Bank of England's policy meeting scheduled for the next day and a vote, expected at 1900 GMT, on the Brexit bill.

Traders were also keen to learn the content of the White Paper on Brexit, outlining what the Government's next steps might be, promised by the Prime Minister for Thursday.

"We believe the biggest near term risk is the ‘Hardness’ of the whitepaper [...] If the overall tone of the bill is too “hard” then investors could dump Sterling as well as Brexit-sensitive sectors of the stock market.

"We are taking a more positive view over the consensus. [...] More certainty (or less uncertainty!) over the Brexit process in concert with a resilient British economy suggests Sterling is undervalued at current market prices. The market has been pricing in disaster, while anything is possible, we think a Brexit catastrophe will be averted," commented Jasper Lawler, senior market analyst at London Capital Group.

As of 1656 GMT, cable was higher by 0.45% to 1.2639 - a one-month high - while the US dollar spot index was bouncing back by 0.36% to 99.87.

Significantly, analysts at Spreadex pointed to a leaked report seen by The Guardian which said London’s economy and those of the remaining member states of the EU will be mutually damaged if Britain fails to secure a “workable” Brexit deal.

The report - written by officials working for the European parliament’s committee on economic and monetary affairs - said a bad deal for London would result in a bad deal for the rest of the EU since UK-based financial services account for 40% of Europe's assets under management and 60% of its capital markets business.

For its part, the euro was down by 0.82% against Sterling to 0.8508.

Acting as a backdrop, the other main currency crosses were retracing part of Tuesday's moves ahead of the US central bank's policy meeting later in the day.

Euro/dollar was lower by 0.38% to 1.0754 and dollar/yen was up by 0.37% to 113.30.