The British pound strengthened against other major currencies in the pre-European session on Wednesday, after data showed that U.K. consumer price inflation slowed less than expected in April, leaving a 50 percent chance of a June rate cut unchanged. Data from the Office for National Statistics showed that the U.K. consumer price inflation weakened to the lowest since July 2021. Consumer prices rose 2.3 percent on a yearly basis in April, slower than the 3.2 percent increase in March. However, inflation was stronger than economists' forecast of 2.1 percent.

The April inflation was the weakest since July 2021, when it was 2.0 percent.

Month-on-month, the consumer price index posted 0.3 percent increase after rising 0.6 percent a month ago. Economists were expecting a 0.2 percent gain.

Another report from the ONS showed that output price inflation was the highest since May 2023. Output prices moved up 1.1 percent after a 0.7 percent gain in March. Monthly inflation remained unchanged at 0.2 percent.

Input prices declined for the eleventh consecutive month in April. Input prices registered an annual fall of 1.6 percent following a 2.5 percent drop in March. The monthly input PPI inflation rate was 0.6 percent in April, following a revised 0.2 percent fall in March.

Also, the European shares traded higher, as investors await highly anticipated earnings results from AI chip leader Nvidia, set for release after the U.S. closing bell.

In economic releases, the minutes of the Fed's April 30-May 1 meeting as well as a report on U.S. existing home sales may garner some attention.

The minutes may shed additional light on Fed officials' thinking with regard to the outlook for rates.

The British sterling held steady against its major rivals in the Asian trading today.

In the European trading now, the pound rose to nearly a 1-1/2-month high of 0.8512 against the euro and nearly a 2-year high of 1.1645 against the Swiss franc, from yesterday's closing quotes of 0.8543 and 1.1582, respectively. If the pound extends its uptrend, it is likely to find resistance around 0.83 against the euro and 1.17 against the franc.

Against the U.S. dollar and the yen, the pound advanced to a 2-month high of 1.2763 and nearly a 4-week high of 199.55 from Tuesday's closing quotes of 1.2708 and 198.54, respectively. The pound may test resistance around 1.29 against the greenback and 201.00 against the yen.

Looking ahead, U.S. MBA mortgage approvals data, U.S. existing home sales data for April and U.S. EIA crude oil data are slated for release in the New York session.

At 2:00 pm ET, the minutes of the U.S. Federal Reserve's latest monetary policy meeting will be published.

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