The pound headed for a weekly advance against the dollar before a report economists said will show British banks approved more home loans in November, boosting demand for U.K. assets. The pound was 0.3 percent from its strongest level since January against the euro. Lenders granted 35,400 loans to buy homes, up from 35,295 a month earlier, the British Bankers’ Association will say today, according to the median prediction of six economists in a Bloomberg News survey. The FTSE 100 (UKX) Index of stocks gained 0.5 percent as investors sought assets perceived to be higher-risk. “Sterling has the wind in its sails right now,� said Lee McDarby, head of dealing on the corporate and institutional treasury desk at Investec Bank Plc in London. The pound rose 0.1 percent to $1.5695 per dollar at 9:05 a.m. London time, headed for a 1 percent advance from Dec. 16. It was little changed at 83.28 pence per euro. The U.K. currency appreciated to 83.03 on Dec. 21, the strongest level since Jan. 12. Sterling has advanced 0.9 percent in 2011 against nine developed-nation peers tracked by Bloomberg Correlation-Weighted Indexes. The dollar is 0.8 percent stronger and the euro has lost 1.4 percent, the indexes show. The yield on 10-year gilts was little changed at 2.05 percent. The 3.75 percent securities due September 2021 changed hands at 114.885. The yield fell to 2.016 percent on Dec. 21, the least since Bloomberg started tracking the data in 1989. Gilts have returned 16 percent this year, including reinvested interest, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies. German government bonds gained 9 percent and U.S. Treasuries have returned 9.5 percent, the indexes show. To contact the reporters on this story: Lukanyo Mnyanda in Edinburgh at lmnyanda@bloomberg.net; David Goodman in London at dgoodman28@bloomberg.net; To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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