British Pound Rises

The pound rose, heading for weekly gains against the dollar and the euro, as stocks rebounded and traders bet interest-rate cuts by the Bank of England will help the U.K. to emerge faster from a recession.

The pound also gained as the FTSE 100 Index advanced, trimming this week's decline, as commodity stocks rallied and the measure traded at the cheapest relative to earnings in at least 15 years. The pound declined 24 percent against the dollar in the past six months as the index fell 37 percent.

The pound rose 2.4 percent to $1.5057 as of 11:26 a.m. in London, from $1.4727 yesterday and $1.4740 at the end of last week. Against the euro, the U.K. currency gained 0.9 percent to 83.78 pence, from 84.56 pence and 85.41 pence on Nov. 14.

The currency dropped the most in a week versus the euro yesterday as the Office for National Statistics said retail sales shrank 0.1 percent last month. It also dropped versus the yen as an increase in U.S. initial jobless claims prompted bets investors will sell higher-yielding assets.

The Australian and New Zealand dollars
headed for a second weekly decline after U.S. stocks slumped to an 11-year low, prompting investors to sell higher- yielding assets.

Australia's currency fell to 60.76 U.S. cents, close to the five-year low of 60.10 cents touched Oct. 28, before trading at 62.09 cents at 5:05 p.m. in Sydney from 62.72 cents yesterday in Asia and 64.81 late last week in New York. The currency declined 6.5 percent this week to 58.87 yen.

New Zealand's dollar fell 1.1 percent today to 53.18 U.S. cents, down 3.8 percent from a week ago in New York. It slumped 6.1 percent this week against Japan's currency to 50.43 yen.

Chinese yuan had the biggest weekly decline in almost a month on speculation China is seeking to protect exporters and prevent a recession in the world's fourth- largest economy. The currency closed at 6.8311 a dollar as of 5:30 p.m. in Shanghai, from 6.8345 yesterday, according to the China Foreign Exchange Trade System. It weakened 0.1 percent this week, the worst since the five-day period ended Oct. 24.,
11/21/2008 5:11:08 AM