By Lukanyo Mnyanda April 13 (Bloomberg) -- The pound rose against the euro as reports showing U.K. exports surged in February and house values increased last month fuelled optimism the recovery from the worst recession since World War II is gathering pace. Britain’s currency traded near its strongest level since Feb. 23 against the dollar. Exports surged 9.5 percent, helping to cut the trade deficit to 6.2 billion pounds ($9.6 billion), the least since June 2006, data from the Office for National Statistics showed. The number of real-estate agents and surveyors saying prices rose exceeded those reporting declines by 9 percentage points in March, the Royal Institution of Chartered Surveyors said in a report today. “We’ve got the trade data and anything that points to better U.K. property performance should be good for the pound,” said Neil Jones, head of European hedge-fund sales at Mizuho Corporate Bank Ltd. in London. “The market is short sterling so it will be sensitive to any good news.” Britain’s currency gained 0.3 percent to 88.14 pence per euro as of 12:18 a.m. in London. The pound gained 0.4 percent to $1.5427, after reaching $1.5486 yesterday. Britain’s currency has gained 2.4 percent against the dollar in the past month, buoyed by data signaling the economic recovery may be sustained after the central bank cut its main interest rate to a record low and bought 200 billion ($308 billion) of gilts to further depress borrowing costs. Economic Recovery The pound climbed last week as the statistics office said producer prices increased last month by the most since May 2008. Gross domestic product grew 0.4 percent in the first quarter, the National Institute of Economic and Social Research said April 8. Aberdeen Asset Management Plc, one of Scotland’s three largest money managers, is buying U.K. government bonds on optimism the country will keep its top credit rating and the pound will retain its value. The pound dropped 6.1 percent against the U.S. currency in the first quarter amid concern no political party will win next month’s election with an outright majority, making any administration less able to tackle the budget deficit. The company, which oversees about 144 billion pounds, put an undisclosed amount of money into gilts during the past two weeks, according to Mike Turner, Aberdeen’s Edinburgh-based head of strategy. The money was raised by selling some stocks across a range of markets, he said. U.K. government bonds were little changed, with the 10-year yield holding at 4.05 percent. The two-year note yield fell 1 basis point to 1.18 percent. The U.K. sold 2.25 billion pounds of bonds maturing 2039, attracting bids equivalent to twice the amount on offer. The government is scheduled to sell 187.3 billion pounds of gilts in fiscal 2010/2011, the London-based Debt Management Office said last month. The Treasury sold a record 227.6 billion pounds of debt in the past fiscal year. To contact the reporter on this story: Lukanyo Mnyanda in London at lmnyanda@bloomberg.net

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