Sterling this week has traded at the highest levels against the euro since May of last year, as previous fears on the impact of Brexit continue to moderate. 

Sterling appreciation over the past few weeks has been a source of relief for Irish exporters to the UK, who have seen their margins squeezed over recent years, according to Garret Grogan, global head of trading at Bank of Ireland Global Markets.

Mr Grogan said that looking ahead, however, a lot of the positive news around the UK economy appears to now be priced into the euro-sterling rate.

UK inflation figures for March are due tomorrow, which although unlikely to dissuade the Bank of England from hiking rates when they meet next month, may alter the pace of future rate increases. 

Tighter policy from the Bank of England has been a major tailwind for the pound since it began increasing rates late last year and any moderation in market expectation for future policy should be closely watched, Mr Grogan said.

With just over two weeks to go to the English local elections and with Prime Minister May facing opposition in Parliament, there is a danger that domestic political risks could potentially resurface, he added.

Sterling was also boosted by seasonal inflows from foreign companies sending dividend payments to British shareholders. 

But today's rally was stymied by data on the labour market that showed worker's total earnings had risen by less than forecast in the three months to February.

UK wages rose by 2.8%, unchanged from the three months to January and weaker than a median forecast of 3% in a Reuters poll of economists. 

After rising as high as $1.4377, the pound had fallen 0.1% to $1.4332, just below a previous post-Brexit-vote high set in January. 

Today's data is important because the Bank of England has signalled that it needs to see rises in wage pressures before it starts to raise rates to curb inflation. Markets expect rates to be raised by 25 basis points next month. 

Against the euro, sterling fell 0.1% to 86.44 pence per euro, still close to 11-month highs.