Sterling consolidated losses today as uncertainty over the progress of negotiations for the UK’s departure from the EU continued to put pressure on the currency.
With the clock ticking on Brexit talks and a turbulent week in Westminster ramping up doubts about British Prime Minister Theresa May's ability to secure a divorce deal, investors were tracking the data for any signs of strength in the UK economy that could support the pound.
Kit Juckes, head of foreign exchange strategy at Société Générale told Reuters: "The UK economy is losing momentum slowly, but it is losing momentum. Any sign that the pace of loss of momentum is picking up is going to make things harder".
Early morning Friday, sterling was trading flat against the dollar at $1.3142, still depressed but a cent above the month's lows hit the week before. It was also flat against the euro, at 88.54p.
There was a recovery of sorts late morning as better-than expected figures on UK industrial and manufacturing output did provide some support for the pound . The pound marginally rose against the dollar, 0.1% higher at $1.3167, following the positive data but there was no marked rebound.
Interest rate impact
The pound plunged last week after the Bank of England raised interest rates for the first time in over a decade but said it was planning for only two more hikes in the next three years, pushing back investors' expectations.
A string of scandals in Westminster, leading to two resignations from the cabinet in the space of just one week, could also be expected to push investors away from the pound.
But high levels of uncertainty in British politics have largely been priced in by the markets, analysts said, sheltering sterling to some degree.
"Sterling is so weak that it takes a lot of bad news to get it any lower," said Juckes. "It's all terrible, but we know it's terrible, so we've priced it as terrible."
Brexit minister David Davis is set to meet his EU counterpart in Brussels as high-level divorce talks resume.