UK pound near four-month high

The UK pound was steady on Friday, holding close to the four-month high it reached versus the euro on Thursday after the Bank of England set out plans for how it would tighten monetary policy, Reuters reports.

The central bank's message was slightly hawkish: the monetary policy committee voted 7-1 to maintain the pace of its government bond-buying, even though it expects inflation to jump to 4 percent around the end of the year.

But it also said that "some modest tightening" of monetary policy over its three-year forecast period was likely to be necessary. Because the hawkish shift had been largely expected, sterling did not react significantly to the news.

But analysts said that it helped to reinforce its strengthening trend.

The British currency has been a strong performer in recent weeks as infections  - while still high - have fallen and high vaccination rates have allowed the British government to lift most social-distancing rules.

At 0756 GMT on Friday, it was little changed against the dollar at US$1.3925, up by 0.2 percent on the week as a whole.

Versus the euro, it was flat at 84.95 pence per euro, up around 0.5 percent on the week as a whole.

Earlier in the session, it touched 84.90 pence per euro, which was the pound's strongest level in four months.