Sterling hit a four-month high versus the dollar on Monday as the greenback extended losses against its European rivals with investors scaling back expectations for sharp interest rate rises in the United States.
The pound hugged tight ranges against the euro however as markets awaited key consumer inflation data, due on Tuesday.
Investors were also focused on political developments as Prime Minister Tony Blair heads into a tough week which may put Iraq back at the top of the political agenda.
Sterling had risen to a four-month high of $1.8662 early in Europe before trimming gains to $1.8630 by 1405 GMT.
Against the euro it stood at 66.50 pence, down a third of a percent on the day but in the middle of recent ranges.
Sterling's trade-weighted index, which has a euro weighting of 64.82 percent, a dollar weighting of 16.49 percent and a yen one of 7.0 percent, hit a three-week high.
Even data showing a sharp fall in producer prices had no impact on sterling as it took cues from movements in the euro/dollar.
Comments
Comments are closed.