Sterling was largely unmoved on Thursday after the Bank of England kept interest rates on hold and warned about the risks of a no-deal Brexit, the British currency trading higher thanks to better-than-expected retail sales and a weaker dollar.
The BoE said on Thursday that Brexit uncertainty had 'intensified considerably' over the last month and that falling oil prices were likely to push inflation below its 2 percent target soon.
Sterling remained 0.6 percent firmer at $1.2684 after the BoE decision.
The pound had earlier risen to as high as $1.2707, helped by strong retail sales growth and a dollar that weakened across-the-board on growing concerns that U.S. policymakers may be raising rates just as the world’s biggest economy faces a slowdown.
Against the euro, the pound was 0.2 percent lower at 90.380 pence.