The pound headed lower against major currency crosses on Tuesday (15 August) after stable inflation data for July reduced the likelihood of an interest rate by the Bank of England over the short-term.

At 4:33pm BST, the pound was down 0.83% versus the dollar at $1.2857, well below 10-month highs versus the greenback seen at the start of the month.

It was also exchanging 0.35% lower versus the euro at €1.0966, accompanied by declines of 0.72%, 0.48% and 0.10% versus the Swiss franc, Canadian dollar and Japanese yen respectively.

Earlier in the session, the Office for National Statistics (ONS) said inflation as measured by the Consumer Price Index (CPI) rose 2.6% year-on-year last month, unchanged from the rate of growth recorded in June and below analysts' expectations for a 2.7% reading.

Ben Brettell, senior economist at Hargreaves Lansdown said the unexpected fall to 2.6% raised hopes that UK inflation had peaked, as the Brexit-induced weakness in the pound started to fade.

"Economists had predicted a slight uptick to 2.7%, but in the event CPI inflation held steady at 2.6%, with falling fuel prices counterbalanced by higher prices for clothes, utilities and food. It now looks quite possible inflation has peaked, and will fall back further incoming months."

Andrew Sentance, former UK central banker and senior economic adviser at PwC, said the jury is still out, however, on whether UK inflation could still rise higher later this year to around 3%.

"The Bank of England may take comfort from the fact that inflation is not continuing to rise over the summer months. But there is still a strong case for starting to edge UK interest rates upwards from their exceptionally low level, following the lead taken by the United States Federal Reserve."

From a technical analysis standpoint, commentators at said the GBP/USD's struggle and the subsequent failure to hold above the psychological $1.30 handle is bearish.

"It faces resistance in the $1.2940-1.2955 area which as previously support. A break above this region on a daily closing basis would be bullish again, ideally if the last high at $1.3030 is also taken out. Unless that happens, we may see further weakness going forward," they wrote in a note to clients.