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Pound weakens versus Dollar before U.K. public finances report

Pound weakens versus Dollar before U.K. public finances report

The Pound dropped against the Dollar, approaching the lowest level in two weeks, before a report that economists said will show Britain’s budget deficit narrowed in March from a year ago.

Sterling was little changed versus the Euro. The shortfall excluding temporary support for banks fell to 15.5 billion pounds from 16.7 billion pounds a year ago. A report by the Confederation of British Industry is forecast to show business manufacturing orders fell at slower pace this month.

Sterling has declined 3.7 percent this year, the second- worst performer after the Yen among 10 developed-market currencies. The Dollar gained 3.3 percent and the Euro rose 2 percent.

Also, the Euro fell to a two-week lows against the Dollar on Tuesday after weak Euro zone purchasing managers’ index data added to speculation over a possible rate cut by the European Central Bank.

In the Eurozone, consumer confidence reported better than expected in April but remained well below the long-term average and exceeding expectations of a modest slippage. This better than expected reading has raised hopes that the Eurozone will emerge from recession this quarter.

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