Pound gains on euro, declines versus USD

The pound weakened versus the US dollar Tuesday but gained in relation to the euro after business confidence in the UK fell to its lowest level in 28 years.

The Confederation of British Industry reported that its quarterly confidence index has fallen to minus 60, from minus 40 in the previous quarter.

In late morning trade in New York, the dollar traded at $1.6948 to the pound while the UK currency was at 77.54p to the euro.

Meanwhile, the Japanese yen gained on both the euro and the dollar on the chance that central banks will cut interest rates again soon.

The dollar gained on the euro, also on interest rate speculation.

Speculation is running in the direction that the European Central Bank will cut another three-quarters of a percentage point off Eurozone interest rates by the middle of next year, faster than the US Federal Reserve is expected to cut rates.

At late morning in New York the yen traded at ¥132.2414 to the euro while it was at ¥100.6250 to the greenback.

At the same time, the US dollar traded at $1.3142 to the euro.

The Canadian dollar was weaker versus its US counterpart after the Canadian central bank cut interest rates there to 2.25 percent.

The Brazilian real and the South African rand both also declined versus the US currency as investors sold higher-yielding currencies on fears of a global recession.

At just before noon in New York, the Canadian dollar traded at C$1.2196 to the US dollar while the real was at R$2.118 to the greenback and the rand was trading at R10.66 to the US currency.

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