CASH and JUNE BRITISH POUND

(5/14): Bank of England Governor Mervyn King will on Tuesday try to justify why officials stopped expanding stimulus even as the outlook for Europe’s economy darkens, Bloomberg News reported. King will present economic forecasts at a press conference in London six days after the bank halted bond purchases. With the pound up 4 percent this year, he must be careful not to fuel a further increase in the currency that would pile pressure on an economy in a double-dip recession, said Alan Clarke, an economist at Scotiabank in London.

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The British pound has become currency traders’ favorite refuge from the resurgent European debt crisis, threatening efforts by U.K. Prime Minister David Cameron to lift the economy out of its second recession in three years.

Sterling has appreciated 3.6 percent this year, the most among 10 developed-market peers, data compiled by Bloomberg show. Strategists have boosted their year-end forecasts for the pound against the euro by 3.6 percent in 2012, while options show investors are becoming more positive on the pound versus its 17-member European counterpart.