Wednesday, July 11, 2007

Pound Rises Versus Dollar to 26-Year High on Rates View, Subprime Concern

(Bloomberg) -- The pound traded at its highest in 26
years against the dollar on speculation the Bank of England will
raise interest rates further this year while a slowdown in the
U.S. housing market keeps the Federal Reserve on hold.

The currency yesterday gained by the most in three months
after Standard & Poor's said it may cut ratings on $12 billion of
bonds backed by U.S. subprime mortgages. The pound has gained 3.5
percent against the dollar this year as investors bought the U.K.
currency to take advantage of the highest rates among the Group
of Seven industrialized nations.


Read more at Bloomberg Currencies News

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