LONDON, Nov 15 Reuters The pound headed for its biggest weekly loss since January on Friday, under pressure from weak UK economic data and a surging dollar that is getting a lift from investors39; conviction that Donald Trump39;s policies will drive up U.S. growth and inflation.

Britain39;s economy contracted unexpectedly in September and growth slowed to a crawl over the third quarter, data showed on Friday.

Sterling was unchanged on the day at 1.26795, around its lowest since May and set for a 2 decline this week, its largest weekly loss since January.

Presidentelect Trump has vowed to levy hefty tariffs on the imports of some of the United States39; biggest trading partners, while at the same time cutting taxes at home and loosening a raft of regulations on anything from energy to cryptocurrencies.

The likely impact is a rise in U.S. inflation and a possible boost to domestic growth, which has sent the dollar to its highest in around a year and eroded the pound39;s erstwhile strength against the U.S. currency.

Sterling has turned negative on the year against the dollar for the first time since July, down 0.4. For most of 2024, it39;s been the bestperforming major currency, on the grounds that UK interest rates will take longer to fall meaningfully than U.S. ones.

With the Federal Reserve looking increasingly likely to cut rates only gradually, given the outlook for a highinflation, highgrowth macro backdrop, the dollar could have more yield appeal than the pound….