Published by Mark Smith-HalvorsenHouse prices in the UK are continuing to follow the general modest downward trend, despite a 0.1 per cent month-on-month increase in May, the Halifax has suggested.Releasing its latest House Price Index, the bank confirmed average prices now sit at £160,519.This represents monthly growth of 0.1 per cent, a quarterly reduction of 1.2 per cent and an annual reduction of 4.2 per cent."House prices continue to drift modestly downwards as measured by the underlying trend," said Martin Ellis, Halifax housing economist.He suggested a number of factors are continuing to put pressure on the housing market and household finances in general. Inflation, higher taxes and weak earnings growth are all affecting property demand.Over the remainder of the year, factors including continued low interest rates and a moderate improvement in the economy are likely to help boost demand for home sales, Mr Ellis added.Figures revealing house price changes commonly affect the pound on the foreign exchange market, as they are seen by traders to give a general indication of the state of a country's economy.For more information on foreign exchange treasury services and risk management, visit our Corporate FX site