- The dollar fell to two-week lows against the pound on Wednesday after the Bank of England updated its forward guidance on bank rates, while the euro fell to session lows following comments by a senior European Central Bank official.

GBP/USD hit 1.6558, the highest since January 30 and was last up 0.41% to 1.6518.

Sterling was boosted after the Bank of England outlined a new forward guidance policy on Wednesday and upgraded its forecast for economic growth this year.

The BoE indicated that it will keep interest rates on hold at record lows of 0.5% for at least another year, despite upgrading its U.K. economic growth forecast for 2014 to 3.4% from 2.8%.

The bank said it will not raise rates until the spare capacity in the U.K. economy has been fully absorbed, which it does not see happening until 2015.

EUR/USD was down 0.49% to 1.3572 after ECB Executive Board member Benoit Coeure said in an interview with Reuters that the bank is considering a negative deposit rate very seriously.

He added that the ECB does not see deflation in the euro area, adding that the bank sees low inflation, which should increase slowly back to its 2% target.

The ECB voted to leave interest rates across the euro zone unchanged at their record low of 0.25% last week. However, ECB head Mario Draghi reiterated that the bank could take further decisive action if necessary.

The dollar was lower against the yen, with USD/JPY down 0.32% to 102.29, but pushed higher against the Swiss franc, with USD/CHF advancing 0.45% to 0.9022.

Elsewhere, the Australian dollar eased back from one-month highs, with AUD/USD dipping 0.03% to 0.9034.

The pair rose to session highs of 0.9068 earlier after data on Wednesday showed that Chinese exports jumped 10.6% in January from a year earlier, far outstripping expectations for 2% gain, while imports jumped 10% and the trade surplus widened.

China is Australia’s largest export destination.

NZD/USD was up 0.19% to 0.8335 after rising to one-month highs of 0.8368 earlier.

The Canadian dollar was almost unchanged against the U.S. dollar, with USD/CAD edging down 0.01% to 1.1006.

The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.20% to 80.87.

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