Sterling fell in European trade on Tuesday against a basket of major rivals, resuming losses against the dollar and almost touching four-week lows.

UK inflation data scheduled for release tomorrow could show that inflation is gradually approaching the 2% target, which might pave the way for a rate cut at the August policy meeting.

The Price

The GBP/USD pair lost 0.2% today to $1.2682, with a session-high at $1.2715.

The pair rose 0.15% on Monday, the first profit in three days away from four-week lows at $1.2657.

UK Inflation

UK consumer prices are expected up 2% in May, slowing down from 2.3%% in April, while core prices are expected up 3.5%.

The Bank of England and several economists expect inflation to tick up again for the rest of the year due to services inflation.

The BOE

The Bank of England is convening this week to decide on monetary policy decisions, with most analysts expecting no change for interest rates at 5.25%.

However, the BOE might strongly hint at cutting interest rates starting August.