Pound Falls Versus Dollar


The pound fell against the dollar on speculation the Bank of England will cut interest rates this week as U.K. economic growth slows.

The pound dropped versus 13 of the 16 most-traded currencies after a panel of lawmakers said the Treasury is overestimating economic growth and tax receipts because it doesn't give enough weight to the risk from financial-market turmoil. The Bank of England will cut its main rate a quarter-percentage point to 5 percent on April 10, according to a Bloomberg News survey.

The pound dropped for a second day, to $1.9880 by 9:32 a.m. in London, from $1.9932 at the end of last week. It was little changed at 78.91 pence per euro.

The chances of a quarter-point rate cut at this week's central bank meeting rose to 82 percent today, from as low as 70 percent last week, according to a Credit Suisse Group index of probability


TradingEconomics.com, Bloomberg
4/7/2008 8:04:40 AM