The British pound started the week sluggishly against the U.S. dollar as a survey highlighted a dip in UK business confidence, and traders continued to assess the dollar’s rally fueled by the Federal Reserve’s cautious stance.

Key Takeaways:

• UK Business Confidence Hits 2024 Low: A survey revealed a drop in December’s domestic confidence levels, even as employers expressed mild optimism about the broader economy.
• Flatlining Growth: Revised Q3 GDP data showed no economic growth, adjusted from a prior estimate of 0.1%.
• Pound Performance: Sterling fell 0.18% on Monday to $1.2544, after rebounding on Friday from a one-month low of $1.2475.
• Diverging Central Bank Policies: While the Bank of England kept rates unchanged last week, its decision showed unexpected division among policymakers. Meanwhile, a hawkish Federal Reserve cut rates but hinted at caution, boosting the dollar.
• Year-End Picture: Sterling has slipped 1.45% against the dollar year-to-date, despite being one of the stronger-performing major currencies earlier this year.