LONDON: Sterling rose against the dollar on Tuesday after data showed British mortgage approvals jumped by the most in over six years in April, while optimism among British construction firms hit a nine-year high in May.
The pound has fallen against the dollar for seven trading days in a row, its worst run in nine months, amid a flurry of weaker-than-expected data and worries about a planned referendum on Britain's EU membership.
Sterling had rallied after the centre-right Conservative party unexpectedly won a national election on May 7 with an overall majority. But since peaking at $1.5815 a week later, it has shed around 3.5 percent.
Sterling hit an intraday high of $1.5248 after Tuesday's data, up from around $1.5200 before its release. That left it up 0.3 percent on the day and clear of a three-week low of $1.5170 touched on Monday.
Against a broadly stronger euro, the pound pared losses to trade at 72.09 pence, still down 0.3 percent.
"People want to buy sterling, particularly against the euro, in the same way that people want to buy dollars," said Chris Turner, head of FX strategy at ING in London. "They're just looking for an excuse and they haven't really had that for sterling for a while.
He added that Tuesday's data was unlikely to change the view that the Bank of England would not start raising interest rates until the middle of next year.
Mortgage approvals for house purchases numbered 68,076 in April, up from 61,945 in March, the BoE said, while growth in lending to consumers remained strong.
The Markit/CIPS UK Construction Purchasing Managers' Index (PMI) also rebounded in May to 55.9 from April's 22-month low of 54.2, above the 50 mark that separates growth from contraction and beating a Reuters poll forecast of 55.0.
That followed PMI numbers for the manufacturing sector, which showed much slower growth than expected.
"The weakness of the number ... raised concerns that the strong pound is acting as a brake on the export capability of UK companies, which in turn could well hit the GDP numbers in Q2," wrote Michael Hewson, chief market analyst at CMC Markets UK.
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