The pound strengthened against the dollar for a fourth day after reports showed U.K. consumer confidence jumped the most in 18 years and house prices rose. Britain’s currency depreciated against the euro, snapping a two-day gain. An index of sentiment rose 10 points to minus 21 in May from the previous month, the highest in five months, GfK NOP Ltd. said. House prices increased 0.3 percent this month, a separate report from Nationwide Building Society showed, beating the median economist estimate of a 0.1 percent gain. Sterling added 0.3 percent to $1.6455 as of 8:10 a.m. in London, the strongest since May 11, and weakened 0.6 percent to 86.70 pence per euro after reaching 86.11 pence yesterday, the strongest since March 11. It was little changed at 133.25 yen. U.K. central bank officials are locked in a debate over whether to tighten monetary policy after inflation accelerated to 4.5 percent in April, the fastest since 2008. While the European Central Bank and Sweden’s Riksbank have already started raising rates, Bank of England Governor Mervyn King says it’s too soon because the recovery remains weak. The increase in sentiment was the biggest since May 1993 and lifts the gauge from a level equal to that seen in the depth of the recession in February 2009. To contact the reporter on this story: Emma Charlton in London at echarlton1@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

Source