The British pound trimmed its earlier losses against the U.S. dollar on Tuesday following the release of wage data indicating steady earnings growth in the UK.

Sterling was last trading just 0.1% lower at $1.26145, recovering from a dip to $1.2596 before the data was published.

According to the Office for National Statistics, average weekly earnings—excluding bonuses—increased by 5.9% in the final three months of 2024 compared to the same period a year earlier.

The rise met analysts' expectations, as projected in a Reuters poll, and marked the third consecutive month of wage growth acceleration. This sustained wage pressure adds complexity to the Bank of England's monetary policy outlook, as officials have indicated a preference for cutting interest rates.