Sterling fell against the dollar on Monday, dragged down as weak Chinese data stoked worries about the global economy, and it was seen vulnerable before a raft of UK economic data this week. Attention will focus on a string of UK figures due this week, including inflation, employment and retail sales, which could knock sterling if they come in on the weak side.
Bank of England minutes will also be watched on Wednesday to see whether policymakers are nudging any closer to propping up the economy with more quantitative easing (QE), which is usually seen as negative for the pound. But traders said they did not expect sterling to move too much before the release of first quarter gross domestic product figures next week, which will reveal whether or not Britain has avoided recession.
The pound was last down 0.2 percent at $1.5306, pulling away from last week's peak of $1.5412, which was its highest level since February 20, though it held above chart support at its 55-day moving average at $1.5300. Sterling was expected to struggle to break above $1.5423, the 38.2 percent retracement of its fall from the 2013 peak of $1.6380 hit in January and the March low of $1.4832.
"There is a general tendency to sell sterling on any rallies ... Any rise towards $1.54 is likely to meet healthy selling interest," said Richard Wiltshire, chief FX broker at ETX Capital. The pound was dragged down against the safe haven dollar as equity markets and commodity prices fell after data showed the Chinese economy grew less than expected.
Sharp falls against the Japanese yen, which staged a broad recovery from recent steep falls, also pulled the pound lower. Sterling fell to a 10-day low around 149.52 yen. The euro was steady against sterling at 85.45 pence, comfortably above the April 1 low of 84.115 pence.
Many investors are still nervous about the British economy's underperformance and the possibility of more monetary easing from the BoE in coming months. A Reuters poll found that while the economy will narrowly skirt recession when the GDP data is released on April 25, growth is likely to be tepid.