Investing.com - The pound fell to session lows against the dollar on Tuesday after data showing that U.K. manufacturing output fell more than expected in October, dampening the outlook for fourth quarter growth.
GBP/USD hit lows of 1.5004, down from around 1.5012 ahead of the data.
The Office for National Statistics said manufacturing output fell 0.4% in October, compared to forecasts for a more modest decline of 0.1%, after rising 0.9% in September.
Manufacturing output fell 0.1% from a year earlier, against expectations for a gain of 0.1%.
Industrial output rose 0.1% on the month, in line with forecasts and was up 1.7% from a year earlier, beating forecasts for a gain of 1.2%.
The data came ahead of the Bank of England’s upcoming monetary policy announcement on Thursday. Most analysts expect the central bank to keep rates on hold at record lows of 0.5%.
The pound was also lower against the euro, with EUR/GBP advancing 0.5% to 0.7234.
Overall market sentiment remained subdued after the latest Chinese trade figures added to fears over a China-led slowdown in global growth.
Chinese exports fell 6.8% on a year-over-year basis in November, the fifth straight monthly decline as weak global demand continued to weigh. Imports were also down, falling 8.7%.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, eased 0.10% to 98.62.
Demand for the dollar continued to be underpinned by expectations that the Federal Reserve is on track to raise interest rates for the first time since 2006 at its upcoming meeting on December 15-16. Higher interest rates would make the dollar more attractive to yield-seeking investors.