Pound Drops Vs Euro


The U.K. pound fell to the lowest level in four months against the euro after a private report showed house prices fell a ninth month.

The pound fell for a second day after the survey from Nationwide Building Society, the nation's fourth-biggest mortgage lender, showed the average value of a home dropped 1.9 percent in August, exceeding economists estimates for a decline of 1.5 percent. Loans approved for house purchases slumped 65 percent last month, the British Bankers' Association said yesterday.

The U.K. currency fell to as low as 80.61 pence per euro by 7:10 a.m. in London, the lowest since April 17, from 80.23 yesterday. The pound was little changed at $1.8348, showing a decline this month of 7.5 percent. It's headed for the biggest monthly loss since October 1992, when it sank 12 percent.

U.K. government bonds dropped with Treasuries and European bonds yesterday, reversing an earlier gain that pushed the yield on the 10-year bond to the lowest level since April 16.


TradingEconomics.com, Bloomberg
8/28/2008 6:32:33 AM