Pound Falls on U.K. Home Prices Drop

The British pound fell against the U.S. dollar as a report indicated the first fall in U.K. home prices in five months, increasing risk aversion towards the pound sterling outlook.
The pound had another day of losses as stocks declined snapping the previous days gains, adding pessimism to the already nebulous equities markets scenario. Rightmove Plc, one of the most relevant British real estate websites, indicated a fall of 0.4 in home prices within Great Britain, being that the first fall in five months, which until now have been witnessing a recovery in the average real estate prices. A part from the negative news in the domestic scenario, the pound also lost ground as currencies like the yen and the U.S. dollar became more attractive to investors as risk appetite decreased this Monday among traders.
The pound outlook, according to currency specialist, is being negatively affected by days of confusion about the global recession, which led to several sessions of losses in stock markets, decreasing attractiveness for the British currency. Domestic reports in the U.K. have not been as positive as expected previously, and the return of demand for refuge currencies like the yen created perfect conditions for a pound downtrend, which may continue further, if equities markets remain bearish.
GBP/USD traded at 1.6440 as of 12:18 GMT from an opening price of 1.6505. GBP/JPY declined to 157.84 from 158.45.
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