* Graphic: Sterling and gilt yields bit.ly/2dgAXn1
* Graphic: World FX rates in 2017 tmsnrt.rs/2egbfVh
* Graphic: Trade-weighted sterling since Brexit vote tmsnrt.rs/2hwV9Hv
By Ritvik Carvalho
LONDON, Feb 24 Sterling slipped from a 2-week
high to the dollar on Friday but was still on track for its
strongest week since January as concerns about politics in the
United States and Europe took investors' focus off immediate
Besides the Brexit bill making its way through Britain's
upper house of parliament, a week largely lacking in major
domestic political developments and new economic numbers has
given the pound some respite.
A number of major banks have predicted another round of
selling of sterling if talks on leaving the European Union get
going next month, as planned by the government .
But a number of technical analysts have said this week that
chart readings suggest even odds of a break up or down.
"Sterling may well continue to recover in coming weeks as
long as market players focus elsewhere," said Richard
Falkenhall, a strategist with Swedish bank SEB.
"While we see good reasons to maintain a negative view on
sterling over the medium term, the political uncertainty created
by upcoming elections in several euro zone countries this year
and the political situation in the US currently seem to
overshadow the troubles we believe will be facing the UK economy
The pound inched down 0.2 percent against the dollar at
$1.2530 by 0906 GMT, having touched a 15-day high of $1.2570 in
early trade in London. It was down a quarter of a percent at
84.37 pence per euro.
That put sterling up just over 1 percent for the week
against the dollar, the euro and the basket of currencies that
measures its broader strength.
The week was not entirely devoid of Brexit developments.
On Thursday, sources close to the Scottish government said
the devolved administration in Edinburgh was increasingly
confident it could win a new independence referendum and that it
is considering calling one next year.
British Prime Minister Theresa May's Conservatives secured a
landmark victory in a parliamentary by-election on Friday,
boosting her hand ahead of the upcoming negotiations as her
rivals suffered damaging poll setbacks.
"After two post-referendum legs of independent weakness, GBP
has become little more than a range trade for the last three
months or more, caught between increasingly independent moves in
USD and EUR," said RBC Capital Markets global head of FX
strategy Adam Cole in a report, adding that the outlook for
sterling would be lower than RBC's $1.15 target.