* Sterling rises after UK inflation data
* Pound supported by expectations of rate hikes in 2015
* Focus shifts to unemployment data on Wednesday
Sterling edged up against the dollar on Tuesday after British inflation figures for July came in as forecast, wrong-footing those who were expecting a slightly lower reading.
Short-term interest rates barely moved and UK government bond futures pared losses after the data, which showed inflation slowed slightly to 2.8 percent year on year from 2.9 percent in June.
Overnight indexed swaps were still pricing in a first rise in the Bank of England's main interest rate in late 2015, a year earlier than suggested last week by the central bank in its first forward guidance on monetary policy.
The pound hit a high of $1.5491 after the data and was last up 0.1 percent at $1.5470, not far from last Thursday's $1.5574, its strongest since June 19. Resistance was cited at the 200-day moving average of $1.5529.
The euro was flat at 85.98 pence. A drop below 85.785 would take the euro to a one-month low.
September gilt futures pared losses after the data. The FTSE 100 stock index held steady.
"The inflation data had a slightly bullish bias for sterling but on the whole it didn't affect the currency much," said Kathleen Brooks, research director at FOREX.com adding that unemployment data would be key for the currency.
Last week the BoE pledged to keep monetary policy accommodative until the unemployment rate falls to 7 percent from the current 7.8 percent, a move the central bank expects to take at least until 2016.
It also said that if inflation was to rise faster than expected or financial stability were to be threatened, it could tighten policy.
Figures released earlier in the day showed British house price inflation leapt to 2006 levels.
Unemployment figures are due on Wednesday and retail sales on Thursday and analysts say these will be main drivers for the currency. Minutes of the Bank of England's last policy meeting will be scrutinised for clues to whether the bank's forward guidance was unanimously agreed.
"Near-term the BoE's new (unemployment) forecasts actually show a slight rise to 7.9 percent this quarter. Should this occur already tomorrow (consensus is for it to remain at 7.8 percent), sterling may suffer," analysts at ING said.
Sterling has been supported by recent positive data. This has led some in the markets to price in a rate hike sooner than suggested by the central bank.