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Pound Declines, Two-Year Gilts Gain as U.K. Retail Sales Slump

The pound slumped to the weakest versus the euro since November and two-year British government notes rose after data showed U.K. retail sales in February dropped more than economists estimated.

Sterling weakened the most in two months against a basket of nine developed-nation currencies. Sales fell 0.8 percent from January, the Office for National Statistics said, more than the median 0.6 decline estimated by economists in a Bloomberg survey. Minutes of the Bank of England’s March meeting published yesterday showed policy makers voted 6-3 to keep interest rates on hold, even as they forecast inflation may accelerate. Chief Economist Spencer Dale, who voted to raise the key rate, today said he would reconsider his stance if the recovery stumbles.