Pound Falls Second Day Versus Dollar After Reaching 2-Year High

The pound weakened for a second day against the dollar, ending a rally that had propelled the currency to the strongest in more than two years yesterday.

Sterling posted its first weekly decline in three weeks versus the U.S. currency as a survey of purchasing managers released yesterday showed a gauge of manufacturing unexpectedly fell, while data today showed construction output cooled in December. The pound strengthened versus the euro today and remained the best performer in the past six months among 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. U.K. government bonds completed a weekly gain.