Investing.com - The pound extended losses against the dollar on Monday, sliding to fresh five-year lows as Friday’s weaker than expected data on U.K. industrial production and uncertainty ahead of next month’s elections continued to weigh.
GBP/USD hit lows of 1.4566, the weakest since June 10, 2010 and was last at 1.4686, off 0.31% for the day.
The pound came under pressure after official figures on Friday showed that U.K. industrial production edged up 0.1% in February, undershooting forecasts of a 0.4% gain.
The smaller than expected increase in industrial output was due in large part to a 12% annual decline in oil and gas production, the largest drop since August 2013.
The soft data sparked concerns over the outlook for first quarter growth, sending sterling lower.
The pound has already come under pressure amid concerns that the 7 May election will result in a hung parliament.
Demand for the greenback continued to be underpinned by expectations for higher interest rates, as investors regained confidence that the U.S. economy would continue to recover after recent economic reports pointed to a slowdown at the start of the year.
The greenback received a boost last week after comments by the presidents of the New York and Richmond Federal Reserve banks made the case for the Fed to begin policy tightening as early as the summer.
Some investors had pushed back the timing of a rate hike until late 2015 after a surprisingly weak U.S. employment report for March.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was steady near three-week highs at 99.71.
Elsewhere, sterling was weaker against the euro, with EUR/GBP rising 0.23% to 0.72.64.