30 March 2001, 12:12  British Pound Little Changed; U.K. Economy to Outpace U.S.'s

London, March 30 (Bloomberg) -- The British pound was little changednear its lowest level this week against the dollar amid expectations theU.K. economy will outperform the U.S.'s in coming months. Sterling was at $1.4274, compared with $1.4302 yesterday. That's nearMonday's $1.4248, the lowest of the week. Against the euro, sterling waslittle changed at 61.59 pence, from 61.58 yesterday, when it traded at ithighest since Dec. 20. ``People are downgrading their U.S. forecasts,'' for growth, said JamesShugg, an economist at Westpac Banking Corp. ``That will benefit othercurrencies, particularly sterling.'' Still, he doesn't see ``the pound movingmuch out of its present range'' in the short-term. Shugg sees U.S. growth of 0.8 percent this year, compared with 2.25percent in the U.K. A stronger economic performance in the U.K. relativeto the U.S. may bolster the pound at the dollar's expense as investors arelured to U.K. financial assets and the pounds needed to buy them. A U.K. consumer confidence survey today showed a rise in consumersentiment for March. GfK Great Britain Ltd. said its consumer ConfidenceBarometer rose to 3 in March, up 1 point from 2 in February and anincrease of 5 from a year earlier. Still, some analysts said the pound's performance against the U.S.currency will be affected by trading in the euro against the dollar. Theysaid the pound is weaker against the dollar than economic growthsuggests it should be because the tumbling euro has dragged it down.Traders often buy and sell the euro and pound together against the dollar. This year, sterling has dropped 4.4 percent against the dollar comparedwith the single currency's 6.7 percent plunge. The euro was also tradinglittle changed at 87.93 U.S. cents, compared with 88.08 yesterday.

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