Pound gains on euro

The pound advanced versus the euro Thursday, trading at 85.43p to the shared currency at around 2:30 p.m. in New York, but dropped versus the US dollar at the same time as the greenback traded at $1.641 versus the UK currency.

Testimony of economist David Miles before the Treasury Committee of Parliament, who said that UK banks remain in trouble and that a return to sustained growth seems “unlikely” at this time hurt the currency, as did a survey of sentiment among UK builders that came in at 44.5 in June, down from 45.9 in May.

The euro declined in relation to the US dollar and the yen after European Central Bank President Jean-Claude Trichet said that economic recover will likely to begin in the region until the middle of next year as the ECB kept interest rates at 1 percent.

At mid-afternoon in New York, the dollar traded at $1.4019 to the euro while the yen had advanced to ¥134.2843 versus the shared currency.

The yen was also gained on the greenback, trading at ¥95.785 to the US currency in New York as a US Labor Department report said that the US lost more jobs than expected last month, limiting investor demand for high-yield, high-risk currency deals often finance by the lower-yielding yen.

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