Domestic data was less supportive too with electronic card retail sales rising a mere 0.1% in November, suggesting policy will have to remain accommodative to fuel consumer spending.
"Broad positioning is short sterling, but not at extremes by any means. This limits the prospect we get an exaggerated short-covering rally to say $1.3800 or $1.4000."
Against a basket of currencies the dollar sat at 90.923, which is about half a percent above a two-and-a-half-year low it hit on Friday as short sellers piled in.