A woman passes by an outdoor advert with an image of the British pound bank note.

London - The pound fell to the lowest level versus the dollar in more than seven months after Bank of England policy maker Martin Weale said that UK exports may benefit from the currency’s decline.

Sterling weakened against all but one of its 16 major peers.

Futures traders reversed their bets that the British pound will gain against the US dollar, weekly figures from the Washington-based Commodity Futures Trading Commission showed.

The UK currency dropped last week after Bank of England Governor Mervyn King said Britain faced a muted economic recovery.

Gilts were little changed.

The pound fell 0.4 percent to $1.5455 at 9:17 a.m. London time after sliding to $1.5438, the lowest level since July 13.

Sterling depreciated 0.3 percent to 86.31 pence per euro, after a 1.8 percent decline last week.

“It may be that high levels of uncertainty and a reluctance to take on new risks have stood in the way of exporters seeking new markets and domestic producers doing what is needed to displace imports,” Weale said in a February 16 speech at the Warwick Economics Summit in Coventry, England.

“Provided the calmer atmosphere we have seen since the summer is sustained, we may see further benefits of the depreciation.”

The pound has tumbled 4.6 percent this year, the second- worst performer after the yen among 10 developed-market currencies tracked by Bloomberg Correlation-Weighted Indexes.

The dollar gained 0.9 percent and the euro rose 2.1 percent.

Net Shorts

The difference in the number of wagers by hedge funds and other large speculators on a decline in the pound compared with those on a gain -- so-called net shorts -- was 16,776 on February 12, compared with net longs of 1,174 a week earlier.

Futures are agreements to buy or sell assets at a set price and date.

The figures reflect holdings in currency-futures contracts at the Chicago Mercantile Exchange.

The UK’s 10-year gilt yield slipped one basis point, or 0.01 percentage point, to 2.18 percent.

The 1.75 percent bond due in September 2022 gained 0.09, or 90 pence per 1,000-pound face amount, to 96.295.

UK government bonds handed investors a loss of 2.8 percent this year through February 15, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies.

German bunds dropped 1.6 percent and Treasuries fell 0.9 percent. - Bloomberg News