The pound was flat at $1.3767, having fallen to $1.3743 in Asian trading, its lowest since Jan. 16 after a large drop on Wednesday.

Sterling has struggled to build on a rally earlier this year amid warnings by the European Union's chief negotiator Michel Barnier that a transitional deal - designed to give Britain and the EU more time to agree the terms of exit - was not guaranteed.

Traders are awaiting the Purchasing Managers' Index survey data on manufacturing for February, as well as consumer lending data, due at 0930 GMT, to see how Britain's economy is holding up.

The market is pricing in a May interest rate hike by the Bank of England, although the central bank has said its monetary outlook is dependent on smooth negotiations with the EU over Brexit.

Against the euro, sterling traded flat at 88.61 pence per euro.