20 April 2001, 11:36  British Pound Climbs Against Dollar, Tracking Euro's Gains

London, April 20 (Bloomberg) -- The British pound rose to a nine-day highagainst the dollar, tracking the euro's gains against the single currency. The pound climbed to $1.4483, its highest since April 4, compared with$1.4380 late yesterday. Still, it has fallen 3 percent against the U.S.currency this year. Against the euro, sterling was at 62.24 pence pereuro from 62.08. Traders frequently buy and sell the euro and sterling together against thedollar because of the British economy's closer links to the euro regionthan to the U.S. The U.K. sells almost 60 percent of its exports to euro-zone countries, compared to about 15 percent to the U.S. The pound follows the single currency ``because the euro zone is moreimportant to the U.K. in trade links than the U.S.,'' said JonathanLoynes, a U.K. economist at Capital Economics, a London consultingfirm. Also, ``the U.K. and euro region economies are holding up wellwhile the U.S. is weakening.'' Investors are waiting for a report on U.K. retail sales, due at 9:30 a.m.London time, for further clues on the state of the economy. Sales in Britain's shops and supermarkets probably rose 0.4 percentafter climbing 0.6 percent in February, according to a Bloomberg Newssurvey. The annual rate of growth is expected to decline to 5.4 percentfrom 5.8 percent. A strong number may boost the pound as it suggests consumers aren'tfeeling the effects of the global slowdown, analysts said. Still, ``better growth prospects over the past six months haven't boostedthe pound, so it's hard to see how one good retail sales figure will makemuch difference,'' said Loynes. Though forecasters have consistently pointed to growth this year of about2.5 percent in the U.K. relative to around 1.5 percent in the U.S., thepound hasn't been able to gain against the dollar.

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