The pound declined the most in three weeks against the dollar after reports showed U.K. house prices fell in October and business expectations slumped. Sterling depreciated from near a seven-week high against the greenback as economists said data today will show mortgage approvals dropped in September. The U.K. currency surged as much as 4.1 percent against the yen after Japan intervened to weaken its currency. The pound fell 0.7 percent to $1.6015 at 7:46 a.m. London time after sliding 1 percent, the biggest decline since Oct. 6. The currency advanced to $1.6152 on Oct. 28, the strongest since Sept. 6. The U.K. currency jumped 3.3 percent to 126.39 yen, and gained 0.2 percent to 87.56 pence per euro. The MSCI Asia Pacific Index fell 2.8 percent, and stocks futures in European and U.S. declined. The average cost of a U.K. home fell 0.2 percent from September and was down 2.8 percent from a year earlier, property researcher Hometrack Ltd. said in an e-mailed report. A separate index of business expectations for the economic outlook fell 22 points in October from September to minus 15, the weakest since March 2009, according to Lloyds Bank Corporate Markets. A Bank of England report will show mortgage approvals fell to 50,600 in September from 52,410 in August, according to a Bloomberg News survey. The pound has weakened 2 percent in the past month against a basket of nine developed-market peers, extending its decline over the past year to 4.4 percent, according to Bloomberg Correlation-Weighted Currency Indexes. To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

Source