The pound climbed against its major counterparts in the European session on Wednesday, as the nation's consumer price inflation accelerated unexpectedly in June for the first time this year.

Data from the Office for National Statistics showed that consumer price inflation rose to 0.6 percent from 0.5 percent in May. The rate was expected to slow to 0.4 percent.

Confounding expectations for a decline of 0.2 percent, consumer prices gained 0.1 percent after remaining unchanged in May.

Excluding energy, food, alcoholic beverages and tobacco, core inflation advanced to 1.4 percent from 1.2 percent in May. The rate was forecast to remain unchanged at 1.2 percent.

Prices for games and clothing provided upward contributions to inflation, while food prices provided downward contribution in June.

Another report from ONS showed that output prices dropped 0.8 percent on a yearly basis, slower than the 1.2 percent decrease in May and the expected drop of 1.1 percent. This was the third consecutive month that the rate has been negative.

Month-on-month, output prices advanced 0.3 percent, reversing a 0.2 percent drop in May. Economists had forecast a monthly growth of 0.2 percent. This was the first time the monthly rate has been positive since January 2020 and the highest since July 2019.

Input prices fell by 6.4 percent on year in June compared to a 9.4 percent drop in May. Economists had forecast a 6.5 percent fall.

On a monthly basis, input prices were up 2.4 percent in June, faster than the 0.9 percent rise logged in May but slower than the 3 percent rise economists' had forecast.

Investors welcomed news of a coronavirus vaccine development by Moderna.

The company said that its potential Covid-19 vaccine delivered a robust immune response in an early stage human trial and that has lifted market sentiment.

The pound rose to 0.9052 against the euro, compared to yesterday's closing value of 0.9080. Next immediate resistance for the pound is seen around the 0.88 level.

The pound hit a 2-day high of 1.2596 against the greenback, after falling to 1.2547 at 5:00 pm ET. The currency is likely to find resistance around the 1.30 level.

The pound firmed to a 2-day high of 1.1837 against the franc, from a low of 1.1784 seen in the Asian session. On the upside, 1.21 is located as the next resistance level for the pound.

The U.K. currency appreciated to 135.08 against the yen, setting a 2-day peak. The pair had closed Tuesday's trading at 134.61. If the pound rallies again, 138.00 is found as its next resistance level.

The Bank of Japan left its massive monetary policy stimulus unchanged and expects the economy to recover at a moderate pace from the downturn caused by the coronavirus pandemic.

The Policy Board of the Bank of Japan voted 8-1 to retain the interest rate at -0.1 percent on current accounts that financial institutions maintain at the central bank.

Looking ahead, U.S. import and export prices and industrial production for June, as well as Fed Beige book report are slated for release in the New York session

The Bank of Canada will announce its interest rate decision at 10:00 am ET. The BoC is widely expected to keep its policy rate steady at 0.25 percent.

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