The pound fell to its weakest level in more than a week against the euro as a report showed U.K. consumer confidence fell in July to a three-month low, fueling concern the economic recovery will falter. Sterling reached its lowest against the dollar since Aug. 17. Nationwide Building Society said its index of sentiment declined 2 points to 49 from June, the lowest reading since April. A gauge of consumers’ expectations for the economy in the next six months slipped 3 points to 67, the customer-owned lender said in an e-mailed report today. Britain’s currency declined for a third day against the euro, losing 0.2 percent to 88.24 pence as of 8:21 a.m. in London. It earlier reached 88.25 pence, the weakest level since Aug. 16. The pound was little changed at $1.6384 after reaching $1.6352, the lowest since Aug. 17. U.K. bonds opened lower, with the 10-year yield rising six basis points to 2.53 percent, while the two-year note yield was two basis points higher at 0.61 percent. Britain’s currency has dropped 7.5 percent in the past 12 months against nine developed-market peers tracked by Bloomberg Correlation-Weighted Currency Indexes, the second biggest decline after the dollar fell 13 percent. The currency slipped as investors speculated that a slowing economy would prompt the Bank of England to keep interest rates at a record low. Gilts have handed investors an 8.3 percent return this year, compared with 5.4 percent from German debt and 6.7 percent from U.S. Treasuries, according to the European Federation of Financial Analysts Societies. To contact the reporters on this story: Lukanyo Mnyanda in Edinburgh at lmnyanda@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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