Sterling dips after data highlights 'horrible' economic backdrop

Bank of England warns inflation is likely to be persistent

Sterling has recovered almost 20% in value since hitting a record low of $1.0327 against the dollar in late September.

Sterling dipped, as a week-old rally ran out of steam following downbeat data and a reminder from the Bank of England's chief economist that inflation could prove persistent, even as domestic energy prices retreat.

A series of surveys showed British consumer spending rose in December — seemingly defying the cost-of-living crisis — but lagged inflation.