By Bo Nielsen Nov. 18 (Bloomberg) -- The dollar and the yen fell against the euro as stock markets in Europe climbed and before a report that may show U.S. housing starts in October climbed to the highest level in almost a year. The U.S. currency also declined versus the Australian and New Zealand dollars. The Dow Jones Stoxx 600 Index climbed 0.4 percent and oil rose for a third day. The pound slid against the euro after minutes of this month’s Bank of England meeting showed policy makers split three ways on whether to extend their bond-buying program and considered cutting the deposit rate. “It’s a relatively good day for oil and stocks are up,” said John Hydeskov, a senior analyst in Copenhagen at Danske Bank A/S, Denmark’s biggest lender. “When equities are up, the euro-dollar tends to tick upwards. That’s a favorable environment.” The dollar fell 0.4 percent to $1.4943 per euro as of 10:57 a.m. in London. The yen slid 0.3 percent to 133.18 versus the euro, and rose 0.2 percent to 89.11 against the dollar. The Australian dollar rose 0.2 percent to 93.27 U.S. cents and the New Zealand currency climbed 0.4 percent to 74.82 U.S. cents. The Dollar Index, which tracks the greenback against currencies of six trading partners, declined 0.5 percent to 75.011. The pound dropped 0.5 percent to 88.93 pence per euro. Housing Starts The dollar weakened as economists surveyed by Bloomberg said U.S. housing starts rose 1.7 percent last month to an annual rate of 600,000, according to the median forecast of 77 estimates. Permits, a sign of future construction, probably advanced to an annual rate of 580,000 last month from 575,000 in September, according to a separate Bloomberg survey. The Commerce Department releases the reports today in Washington. Recovery from the deepest U.S. recession since the 1930s will be “gradual and bumpy,” Federal Reserve Bank of Cleveland President Sandra Pianalto said yesterday in Columbus, Ohio. “The current lower-for-longer stance could continue to weigh on the dollar during risk-seeking periods until Fed officials give a better indication of timing,” Gareth Berry, a Singapore-based currency analyst with UBS AG, wrote today. Minutes from the Bank of England’s Nov. 5 meeting showed policy makers weren’t unanimous on the 200 billion-pound ($336 billion) bond-purchase program and discussed lowering the deposit rate on bank reserves to spur lending. “A reduction in the rate of remuneration relative to bank rate on a proportion of commercial bank reserves would bear down on short-term market rates and could ease monetary conditions further,” according to the minutes. The committee “agreed that it might be a useful policy tool in some circumstances, and therefore should be available in future,” the bank said. The Office for National Statistics in London may say tomorrow that retail sales rose 0.5 percent in October after stagnating in September, according to a Bloomberg survey. A report showed Japanese investors sold 1.49 trillion yen more in foreign bonds and notes than they bought in October, the most since August 2008, according to data from the Ministry of Finance. To contact the reporters on this story: Bo Nielsen in Copenhagen at bnielsen4@bloomberg.net

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