The pound depreciated for a third day versus the euro as a report showing U.K. inflation dropped to zero in February underpinned the case for the Bank of England to keep interest rates at a record low.
Sterling fell against all of its 16 major peers, reaching the weakest level in a month versus Europe’s shared currency. The slowdown in inflation from 0.3 percent in January was sharper than economists had forecast and marked the first zero reading since 1989. The cost of living in the U.S. excluding food and fuel rose in February, separate data showed. Federal Reserve policy makers are looking for inflation to accelerate as they weigh the timing of the first rate increase since 2006.