With a Brexit deal still not in the bag, the Bank of England's rate-setters are expected to vote unanimously to keep their benchmark borrowing rate at 0.75 percent and trim their growth forecasts, according to a Reuters poll of economists.

"Broad dollar strength and rising nerves on Brexit negotiations is weighing on the pound," said Morten Helt, a currency strategist at Danske Bank.

The pound briefly fell through $1.29 for the first time since Jan. 22 before trimming some losses. It was trading down 0.2 percent at $1.2908. Against the euro, the pound was a shade weaker at 87.88 pence.

Prime Minister Theresa May will call on the European Union on Thursday to work with her to change the Brexit divorce deal and help her win the support of a divided parliament to smooth Britain's departure from the bloc.

On Wednesday, European Council President Donald Tusk had said the EU would make no new offer on Brexit and those who promoted Britain's exit without any plan of how to deliver it deserve a "special place in hell".