Sterling falls ahead of GDP data

LONDON (Reuters) - The pound fell on Friday as investors eyed British economic growth data for signs of whether the Bank of England will raise interest rates this year.

Weak economic data, fresh Brexit concerns and a strong dollar have punished the pound, which started 2018 as one of the best-performing currencies.

Because of economic weakness, partly caused by bad weather, markets have drastically scaled back expectations for interest rate rises from the Bank of England this year.

Sterling strengthened on Thursday after data showed British retail sales jumped by its most in one-and-a-half years in April but then relinquished most of its gains.

At GMT 0810 the pound was down 0.2 percent to $1.3352 as the dollar gained across most major currencies.

The economic release is due out at 0830 GMT and is expected to show the same moderate growth as last year.

The Bank of England said earlier this month that it believed underlying growth in the economy in the first three months of 2018 was faster than the 0.1 percent calculated by the Office for National Statistics.

But the BoE’s doubts over whether first-quarter economic growth was really as weak as official data showed may well not be resolved by the next quarter’s set of growth numbers, BoE Governor Mark Carney said on Thursday.

Reporting by Tom Finn, editing by Larry King