GBP/USD pops to session highs on the FOMC minutes failing to underpin 50bps hike

• GBP/USD pops to session highs on less hawkish than expected minutes. 
• US dollar lowest level since Friday, but Russian headlines coming through could support.

GBP/USD is reaching highs of 1.3594 on Wednesday following the release of the Federal Open Market Committee minutes that failed to portray a message of 50bps worth of hiking as soon as the March meeting.

This was a number touted by the most hawkish of Fed officials and was being priced in by the markets. Consequently, the US dollar is being sold off. DXY, an index that measures the greenback vs a basket of major rivals, has printed a fresh low for the day of 95.692. This is the lowest level since Friday, Feb.11.

Meanwhile, sterling was higher across the board on Wednesday after data showed inflation in Britain at a nearly 30-year high. Markets are pricing in the convergence between the Fed and Bank of England as they suspect that the BoE will hike interest rates again. The BoE has hiked twice since December. Rates have risen to 0.5% from 0.1%. Another hike to 0.75% or 1% on March 17 after the BoE's next meeting is expected.

The data showed that the Consumer Price Index on an annual basis climbed to 5.5% in January. This was the highest since March 1992, and above expectations from economists for it to hold at December's 5.4%.

Reuters explained that ''soaring inflation across many global economies has sparked a debate about how fast central banks should rein in stimulus deployed earlier in the COVID-19 pandemic to prop up businesses and consumers.''

Meanwhile, there are plenty of risk-off Russian headlines coming through that could lead to a safe-haven bid in the greenback and curb the FOMC minutes decline. The US State Department said that more Russian forces, not fewer, are on Ukraine border and they're moving concerningly into fighting positions.