BLBG:Pound Gains Versus Dollar as G-20 Pledges a ‘Strong’ Response to Economy
The pound rose for the first time in three days against the dollar after the Group of 20 nations pledged a “strong and coordinated” response to challenges facing the global economy, damping demand for safer assets.
The U.K. currency strengthened versus most of its 16 major peers tracked by Bloomberg, paring its fifth straight weekly decline against the dollar. It rebounded versus the yen after dropping to a record low yesterday. Gilts fell, leaving the two- year yield within seven basis points of a record low.
The pound gained 0.5 percent to $1.5417 as of 8:32 a.m. in London. It dropped to $1.5328 yesterday, the lowest level since Sept. 7, 2010. The U.K. currency appreciated 0.5 percent to 117.58 yen, after falling to a record low 116.84 yen yesterday. Sterling was little changed at 87.63 pence per euro, from 87.76 pence in New York.
The G-20 nations are “committed to a strong and coordinated international response to address the renewed challenges facing the global economy, notably from heightened downside risks from sovereign stresses, financial system fragility, market turbulence, weak economic growth and unacceptably high unemployment,” finance chiefs said in a statement released after talks in Washington.
The pound has fallen 5 percent in the past 12 months, the worst performer among 10 developed-market currencies tracked by Bloomberg Correlation-Weighted Currency Indexes.
The 10-year gilt yield added three basis points to 2.34 percent, while the two-year yield rose one basis point to 0.54 percent. The rate dropped to a record 0.477 percent yesterday, the lowest since Bloomberg began collecting data on the securities in 1992.
To contact the reporter on this story: Keith Jenkins in London at Kjenkins3@bloomberg.net
To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net
