Lower house price growth and recent interest rate rises saw the pound fall for the second consecutive day on Thursday.

Having reached a 26-year high against the dollar earlier in the week, the pound fell to $2.0505 during London foreign exchange trading from $2.0537 the night before, Bloomberg reports.

Sterling also fell against the euro from 67.81p to 66.90p.

The pound's decline has been attributed to data released from Nationwide which showed that the country's housing market had experienced slower than expected growth.

Fionnuala Earley, the company's chief economist, said: "House prices managed a seasonally adjusted gain of only 0.1 per cent in July, the slowest pace of growth since April 2006."

This slowdown in growth brought the annual rate of inflation to 9.9 per cent, after three consecutive months of double-digit growth, she added.

According to the firm, the average cost of a home in the UK increased slightly to £184,270 in July.