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Wednesday 6 July 2016

Sterling Falls To Lowest Level For More Than Three Decades - As Low As $1.2798 Against The Dollar & €1.17 Against Euro

The pound has plummeted against the US dollar off the back of the Brexit vote and is back to mid-1980s levels

The summer holidays of Britons heading to the States and the Continent just got even more expensive after sterling fell to its lowest level against the dollar for more than three decades.
As investors bet that the Bank of England will cut interest rates towards zero the pound fell overnight to as low as $1.2798 against the dollar, before recovering slightly to $1.2867.
That marked a level not seen since 1985 when Margaret Thatcher was Prime Minister and Ronald Reagan was in the White House. 
After initially rising this morning, London's leading stock market index, the FTSE 100 slipped into the red and was trading down 0.2 per cent, or 11 points, at 6,534.3. 


The slump overnight followed another dramatic session on the financial markets yesterday, when the pound dropped to $1.3001, meaning it has fallen by more than 15 per cent since the referendum day.
Sterling also touched €1.17 against the euro for the first time since late 2013 as analysts described the UK currency as ‘the whipping boy of Brexit’.
But Bank of England governor Mark Carney said the fall in the value of the pound – it is down more than 13 per cent against the dollar since the vote to leave the European Union – would boost exporters. 
He also said the fall in Government borrowing costs – with the ten-year gilt yield at a record low of 0.77 per cent – had helped push down corporate loan rates.

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