Pound Rises Fourth Time This Week Versus Euro on Growth Outlook

The pound rose for the fourth time in five days versus the euro amid evidence the economy is withstanding the stagnation that may lead to more European Central Bank stimulus for its neighbors. Sterling was set for the first weekly advance versus the dollar since mid-October. Chancellor of the Exchequer George Osborne upgraded the U.K.’s growth forecast for next year during his Dec. 3 Autumn Statement, a day before the ECB downgraded its forecasts for growth and inflation through 2016. U.K. government bonds fell, extending their first drop in five weeks. “Look at any of the data, employment is better, the PMIs are better,” in the U.K., said Paul Bednarczyk, a currency strategist at 4Cast Ltd. in London. “Euro-sterling could easily over the next year or two hit below 70 pence,” he said. The pound gained 0.2 percent to 78.80 pence per euro at 11:05 a.m. London time after touching 78.33 pence on Dec. 3, the strongest level since Nov. 12. It has jumped 1 percent this week. Sterling was little changed at $1.5688, set for a gain of 0.3 percent since Nov. 28, the first weekly increase since Oct. 17. The British economy will expand 3.2 percent this year, the most among the Group-of-Seven nations, the International Monetary Fund said in its latest World Economic Outlook released in October. The euro area economy will grow 0.8 percent, with Italy’s economy contracting, the IMF said. lmnyanda@bloomberg.net