Europe: Virtually flat

LONDON: Sterling fell to a 21/2-year low and European shares were flat yesterday after data underscoring Britain's economic weakness bolstered expectations of a jolt of central bank stimulus.

"There are concerns on just about every front for the UK," said Neil Mellor at Bank of New York Mellon.

"Political concerns, whether there will be another downgrade, the budget and whether or not we will see more monetary stimulus. Everywhere you look there is a negative." The poor UK data also wiped out the small gains European shares had clocked up earlier.

Despite hopes of more Bank of England stimulus nudging up London's FTSE 100, falls of 0.1 on Paris's CAC-40 and Frankfurt's DAX left the pan-European FTSEurofirst 300 virtually unchanged yesterday. Reuters