LONDON: The pound held steady on Friday, leaving it on track for its biggest weekly rise since mid-September after the dollar gave up some of its post-election gains.

Sterling was last at $1.269 after rising to a two-week high of $1.275 in early trading, and was set for a weekly gain of 1.2%.

The euro flat versus the pound at 83.21 pence, within the range the currency pair has traded in since mid-September.

The dollar dropped as bond yields fell on Monday after President-elect Donald Trump picked hedge fund manager Scott Bessent as Treasury secretary, which reassured some investors that his more radical and inflationary policies may be tempered.

Analysts had a harder time explaining the dollar’s further drop on Wednesday although they said investors were likely rebalancing their portfolios before the end of the month, taking profit on US stocks, bonds and the dollar after the post-election rally.

There has been little on the British side driving sterling this week. Market expectations for further Bank of England rate cuts by the end of next year have stayed at around 75 basis points.

Sterling has held up better than almost all other developed economy currencies this year bar the dollar, as economic growth has ticked along and wage and services inflation has remained strong, limiting the scope for BoE cuts.

Data on Friday showed British lenders approved the most mortgages for house purchase since August 2022 last month, although consumer credit growth slowed slightly to its weakest in nearly two years.

The BoE warned in a report that higher trade barriers could hit global growth and feed uncertainty about inflation, potentially causing volatility in financial markets.