The pound dipped to as low as €1.4236 this morning, after figures showed the UK's manufacturing sector stalled in November.
The CIPS/Markit Purchasing Managers' Index (PMI) fell to 52.7 in November, from 55.2 the month below. Although it was above the 50 mark which denotes expansion, the figure was still well below consensus of 53.6.
However, economists pointed out the figure was in line with recent trends.
"The latest data looks more in line with the overall flattish trend that we’ve seen since the second quarter of this year," said David Morrison, senior market strategist at Spreadco.
Russ Mould, investment director at AJ Bell, added that the figure was "unlikely to alarm anyone".
“The November reading is exactly in line with the 12-month average and represents the thirty-fifth straight score above the 50 threshold which divides growth from contraction.
“However, the UK’s industrial engineering sector has largely looked through such optimism and has sold off hard since the summer. This may reflect the survey’s cautious tone when it comes to slower expansion in new orders and further pressure on selling prices.
“Weakness in sterling against the dollar may help here but strength against the euro will be a hindrance and manufacturers may be looking toward Thursday’s ECB statement with some concern, as President Mario Draghi seems happy to talk down the single currency and give the Eurozone a competitive edge.”