Sentiment was a little fractious elsewhere with haven assets like gold touching a 7-year high in response to a faster spread of the coronavirus to counties outside of China.
GBP/USD was higher by 55 pips (+0.42%) at 1.2932 with a daily price range of 1.2878 to 1.2952 as of 2pm GMT.
GBP/USD reclaimed the 1.29 handle in early trading but fell short of 1.295 to leave a weekly decline of -0.87%.
Better than forecast PMI data improved the prospects for first quarter growth in the United Kingdom and encouraged Sterling bulls to come off the side-lines on Friday. Traders broke a pattern of ignoring positive UK economic data and selling pounds on continued EU trade concern. The Markit manufacturing PMI rose to 51.9, up from the 50 in the previous month and confounding estimates for falling activity to 49.7. There was a small moderation in the service sector, but it remains in healthy expansion at 53.3.
The post-election bounce in consumer and business activity is clear to see but traders remain cautious with just over one week to go until negotiations between London and Brussels begin. Gains were capped in Sterling, as with other riskier currencies by wider market concern about a sharp rise in the number of coronavirus cases in and outside of China. Public sector net borrowing in January fell to a deficit of -£10.538 from the £3.459B surplous in December. Projections are for overall borrowing to fall below £50 billion.
Improved economic data out of Germany and France has seen demand for dollar come off on Friday after a week that saw multi-year lows for the euro-dollar exchange rate. Part of the attraction of the dollar has been the dreary economic performance in the likes of Japan and Germany. German manufacturing activity saw a surprise rebound in February to the highest since February 2019.