Cable gave ground to the greenback in London as traders took profits ahead of the UK retail sales.
Sterling gained against the dollar on Friday after the February non-farm payrolls failed to impress. The US economy added 262 thousand jobs in February, the highest gain since October as companies hired more workers, suggesting that the US businesses are becoming more confident in the world's largest economy.
Markets offered the pound ahead of the UK retail sales scheduled to be released later this week. The retail sales are expected to be weaker as consumer confidence fell prompted by rise in crude oil prices. Cable bears expect that the Bank of England may keep the rates unchanged given weaker retail sales.
The sterling was quoted at 1.9136-41 against the dollar, .6895-98 versus the euro and 201.40-49 against the Japanese yen at 13:00 GMT.
London stocks traded lower as weakness in the pharmaceuticals, banking and mining sectors weighed on the investors sentiment.
The FTSE 100 fell 0.2 percent to 5,027.0 while the mid-cap FTSE 250 lost 0.2 percent to 7,302.2.
London Stock Exchange fell 7.2 percent to 500p after the Deutsche Borse had withdrawn its 530p offer, leaving Euronext as the only bidder. The bid withdrawal impacted the forex market as traders bid the EUR/GBP cross after the merger failed to materialize.
BAE Systems fell 3 percent after the defense contractor announced an acquisition of United Defense Industries, the second largest US producer of military ground vehicles.
Exel rose 1.6 percent to 852p as investors rallied the company's shares ahead of the full year results.
Hanson rose 1.6 percent to 510p after the building materials company acquired Thermalite, the UK manufacturer of lightweight concrete blocks.
GlaxoSmithKline fell 1.2 percent to GBP12.73 after the news that the FDA seized two of its key products following manufacturing issues.
International Power fell 1.9 percent to 182.25p after an analyst downgrade.
The UK Gilts rallied as investors bid the bonds on expectations that UK retail sales will be weaker than expected and that the Bank of England will keep its benchmark rate unchanged. The 10 Year UK Gilts gained 0.13 to 99.91 with yields up 1 basis point to 4.76 percent. The Long Gilt futures contract for June delivery added 0.09 to 109.33.