Bloomberg News

Pound Approaches One-Month Low Versus Euro as Inflation Slows

June 08, 2011

June 8 (Bloomberg) -- The pound traded within half a penny of its weakest level against the euro in a month as a report showed U.K. shop-price inflation decelerated in May to its slowest pace this year.

The U.K. currency slid versus the yen and the dollar as the British Retail Consortium report showed prices charged by retailers rose 2.3 percent from a year ago, after advancing 2.5 percent in April. The European Commission said yesterday the U.K. government faces a “challenge” to implement its planned budget-deficit reduction program and some of its growth forecasts are too optimistic.

Sterling was little changed at 89.33 pence per euro as of 7:12 a.m. in London, after reaching 89.46 pence yesterday, the weakest level since May 5. It’s declined against the 17-nation currency on each of the previous six days.

Against the dollar, the pound was 0.1 percent lower at $1.6427. It declined 0.2 percent to 131.47 yen.

--Editors: Matthew Brown, Daniel Tilles

To contact the reporter on this story: Paul Dobson in London at pdobson2@bloomberg.net

To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net


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