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Sterling has risen to $1.6300 versus the US tender after the Bank of England maintained the interest rate level and put its asset-buying programme on hold, Reuters reports.
But this came after the US Federal Reserve opted to purchase $600 billion (£368 billion) in government bonds to help with unemployment and encourage growth.
Chris Huddlestone, head of money markets at Investec Treasury Solutions, said "The immediate market reaction was that sterling strengthened and gilt prices fell."
He added that it would probably take recent positive news reversing to lead the committee to restart quantitative easing.
This comes after the pound closed up 0.2 per cent on the dollar at $1.6076 yesterday following the PMI's main business activity index gaining to 53.2 last month from 52.8 in September. Sterling had risen as high as $1.6157 earlier in the day.
Posted by Greg Secker
