The pound edged higher today as strong British retail sales lifted sentiment.
However, investors were considering the consequences of a Brexit vote defeat in parliament for Prime Minister Theresa May.
On a weekly basis, the British currency was set for its third consecutive drop.
Analysts said the latest parliamentary loss for the government, although on a symbolic vote, indicates May does not have the support of her lawmakers.
With less than six weeks before the March 29th exit date, May has stepped up efforts to convince the European Union to grant her concessions.
"The constant Brexit can-kicking has also increased the risks of a disorderly exit," strategists at BNP Paribas said in a daily note.
May has promised that if parliament has not approved a deal by February 26th, she will make a statement updating lawmakers on her progress on that day and lawmakers will have an opportunity on February 27th to debate and vote on the way forward.
The pound was set to end the week on a cheerful note as data showed British retail sales rebounded in January, shaking off some of the recent gloom over the UK economy as the Brexit departure date nears.
A decline in the euro accounted for much of the move, though.
The euro fell after a European Central Bank board member said policy makers were discussing whether to issue new multi-year cheap loans to banks.
