TOKYO - The pound dipped on Tuesday and was seen likely to stay weak after tumbling to a 10-month low the previous day, while the euro's outlook remained clouded by uncertainty over a bailout for debt-strapped Greece.
The Australian dollar dropped slightly ahead of a central bank rate decision later on Tuesday, with markets pricing in a roughly 65 percent chance of a 25 basis point rate rise to 4.0 pct.
The outlook for the sterling and the euro is unlikely to improve immediately given the various factors working against them, a trader for a European bank said.
"Overall, there is still likely to be selling pressure against the European currencies," he continued.
"One of the factors has to do with politics and that is not something that will disappear in a day or two, so sterling may remain under selling pressure."
Sterling took a dive on Monday, hurt by factors such as worries that a UK election due in months could give neither the opposition Conservatives nor the ruling Labour Party a parliamentary majority.
Such an outcome could hinder a new government from effectively dealing with bringing down the UK budget deficit.
Sterling has also been under pressure after Bank of England Governor Mervyn King said recently that the central bank may still have to restart its asset-buying programme if the economic outlook worsens.
Sterling dipped 0.1 percent from late U.S. trading on Monday to $1.4976.
On Monday, it fell by as much as 4 cents at one point to a 10-month low of $1.4781, and although it later trimmed some losses, still finished the day down 1.6 percent for its biggest one-day percentage fall in more than four months.
