Pound weaker on house prices, business confidence

The pound weakened versus both the euro and the greenback Monday on the news that UK house prices are down again this month as house-price tracker Rightmove (LSE: RMV) said that the average house price in Britain had dropped 4.8 percent in August from the same time last year.

In addition, an index of business sentiment from Lloyds TSB (LSE: LLOY) showed confidence at its lowest level in at least six years among over 200 companies surveyed.

By late morning in New York, the pound traded at 78.85p to the euro while it took $1.8653 to buy a pound.

The US dollar declined against the yen, the Australian dollar and the New Zealand dollar Monday on worries that its 8.4 percent gain versus the euro since July was too quick.

The declines for the dollar came ahead of separate reports on wholesale costs and housing starts in the US, due Tuesday.

In late morning trade in New York, the dollar traded at $1.4706 to the euro, while it took ¥110.2300 to buy a greenback, 87.01 cents US to buy an Aussie, and 71.11 cents US to buy a New Zealand dollar.

The gains for the Aussie and the kiwi against their US counterpart came even though interest rates in both Australia and New Zealand are expected to go lower next year and although in New Zealand a report showed that the service sector contracted again in July.

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