GBP/USD down to 1.6170 as Home Loans Drop

The pound weakened from a one-month high against the dollar as an industry report showed U.K. mortgage approvals unexpectedly declined in October.

Sterling slid by the most in two weeks versus the greenback on speculation gross domestic product data will fail to exceed analyst forecasts. The pound was little changed versus the euro after European Central Bank Governing Council member Ardo Hansson said officials stand ready to cut benchmark interest rates further. Former Bank of England policy maker Adam Posen said a house-price bubble may provoke a crisis in the pound. U.K. government bonds advanced.

“You’re seeing some profit taking on the back of concerns that the market is getting too far ahead of itself in terms of early rate-hike expectations,” said Peter Kinsella, a senior currency strategist at Commerzbank AG in London. “That said, I’m of the view that sterling will appreciate more from here in line with the improvement in economic growth.”

Bloomberg

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