On Wednesday, Mark Carney, the BoE Governor, said that with the United Kingdom economy edging closer to full capacity, the central bank would begin debating the likelihood of an interest rate increase.
"These are some of the issues that the MPC will debate in the coming months".
He said the strengthening global economy and the United Kingdom competitiveness following the fall in sterling is creating the "possibility of a self-reinforcing revival in investment".
Markets flocked to Sterling as Carney hinted that the central bank may be moving towards tightening monetary policy in the near future as he said that continued economic growth could force the BoE's hand into raising interest rates.
Each increase of 0.5 per cent will swell banks' cushion of common equity Tier 1, the highest-quality capital, by £5.7 billion, according to the BOE's Financial Stability Report published on Tuesday. Specifically, BoE Governor Mark Carney's indication that a rate rise may be in the works certainly triggered a reaction in the currency market with GBP/USD jumping to $1.2950 levels while the FTSE 100 slipped in reaction.
"(Carney's comments) have been quite supportive for the pound, particularly against the dollar which is trading around pre-election levels", said Alexandra Russell-Oliver, currency analyst with Caxton FX.
Using gold as a gauge of risk sentiment for the markets, it may be interesting to note that we could be seeing the first monthly decline in prices for the safe haven asset this year, though I would regard the current trend as retaining consolidation.
As well as potentially Haldane, Ian McCafferty and Michael Saunders are likely to vote for a rate hike again in August's BoE policy decision.
"However, interest rates will likely remain on hold for the time being, and Carney has tended to be on the more cautious side".
It spiked above $1.30, having not reached that level since 25 May, before some of the gains came off.
Howard Archer, chief economic advisor to forecasters the EY ITEM Club, said: "This was the 13th successive month of double-digit year-on-year consumer credit growth, and occurred despite weakened retail sales during the month. Whether through an increase in long-term interest rates, adjustments to growth expectations or both", Carney says.
A break above those highs would give a strong bullish signal that the pair was going to continue higher, with an initial target at 1.3025 and then 1.3150, assuming a break above the 1.3051 May highs.
Sterling jumped by 1% to 1.29 versus the U.S. dollar on the news, with Mr Carney's comments proving more hawkish compared to his Mansion House speech last week when he said "now is not yet the time to begin that adjustment".