Sterling was broadly higher early on Wednesday after the Bank of England put the prospect of an interest rate hike front and center. Meanwhile, a surprise fall in U.S. retail sales kept the dollar pinned down. Speaking to British lawmakers on Tuesday, BOE Governor Mark Carney said the time for the first rate hike since the financial crisis was getting closer. His comments caught the market's attention just as Greece was becoming less of a concern and put the spotlight firmly on Federal Reserve Chair Janet Yellen's congressional testimony. While Yellen is likely to reiterate that the Fed will probably start hiking rates this year, disappointing U.S. retail sales on Tuesday lengthened the odds for a September lift off.
Iran will return to the global oil market with maximum capacity once the sanctions against the country are lifted following Iran's nuclear deal with world powers, a deputy oil minister was quoted as saying on Tuesday. Iran and six major world powers reached a landmark nuclear deal on Tuesday, capping more than a decade of negotiations. Oil prices tumbled more than $1 on the news, as the deal would see an easing of sanctions against Tehran and a gradual increase in its oil exports.
Asian stocks inched cautiously higher on Wednesday, taking their cue from Wall Street ahead of key events, including Chinese economic data, a Bank of Japan policy decision and congressional testimony by the U.S. Federal Reserve chief. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS edged up 0.1 percent, while Japan's Nikkei stock index .N225 advanced 0.5 percent in early trade.