There was little change for Sterling on Friday after declining to a five-month low against the Dollar in Asian trading as investors reacted to reports of an Israeli attack on Iran.

Safe-haven currencies such as the Yen, Swiss Franc and Dollar initially rose following the news, helping to drive down the Pound and Euro.

At the time of writing, Sterling edged up slightly to $1.2446, after falling to $1.2388 in Asia.

For the week, the Pound is down marginally but has eased 1.5% for the month up to now following a surge in the greenback resulting from robust US economic data.

The dollar index, measuring the currency against six rivals, was up 0.1% on Friday, according to Reuters reports.

There was only a minor change for the Euro against the Pound at 85.58 pence, after trading around that level since February.

In addition to the tensions in the Middle East, UK investors were analysing data revealing that retail sales remained stagnant in March despite a decrease in inflation. 

Economists surveyed by Reuters had predicted sales volumes would rise by 0.3% on the month.

“Stagnating March retail sales provide a disappointing end to the quarter,” stated Rob Wood, chief UK economist at Pantheon Macroeconomics.

“Even so, stagnation is a significant turnaround from the large retail volumes falls seen over the past two years.”

Traders generally anticipate that the Bank of England will decrease interest rates once or twice within the year, with the potential to begin this adjustment around August or September, as indicated by pricing in derivatives markets.

At the beginning of the year, markets were anticipating four or more rate cuts. However, the resilience of US growth and inflationary pressures, coupled with a modest uptick in UK growth, have cast doubts on whether inflation has been effectively quelled.