Sterling rose with the growth of wages in Britain and the yen near the highest level in 7 months

The British pound rose on Tuesday after data showed that wage growth in Britain, which the Bank of England watches closely to determine the pace of interest rate hikes, accelerated again.

The yen held near its highest levels in seven months, with investors holding their breath in anticipation of a possible policy shift by the Bank of Japan.

The British pound rose 0.2% to $1.2218 after data showed that wage growth accelerated in the three months to November, while employment increased at a faster-than-expected rate of 27,000.

Bank of England Governor Andrew Bailey said on Monday that a shortage of staff in the labor market posed a significant risk to predictions that inflation would decline from current levels of more than 10 percent.

Japan settled near 128.72 per dollar, down 0.17 percent, after recording on Monday a high level reached in late May at 127.22 per dollar.

Speculation is growing about changing or ending the policy of controlling the yield curve of Japanese government bonds, given that the market has pushed yields on ten-year bonds above the maximum limit set by the Bank of Japan at 0.5 percent.

On the other hand, the dollar index recovered from its lowest level in seven months, which it recorded on Monday at 101.77, and settled at 102.4, up 0.1 percent. The euro settled at $1.0819.

There was little reaction in the currency market to the stronger-than-expected Chinese growth data. The yuan last fell 0.6 percent to 6.7760 per dollar.