Currency Update: British Pound Tumbles Further

The pound continues to take a hammering, dropping yesterday at one stage to a record low against the dollar, the pound breached $1.50 for a second day as the recession takes a hold and drags down Britain.

A currency strategist at the world’s second-biggest foreign exchange USB AG predicts that the Sterling weakness will continue for another two or three quarters, due to the fact the Bank of England is more than likely going to have to cut the interest rate further the pound will continue to drift.

Mervyn King the Governor of the Bank of England indicated that he is likely to be cutting the base interest rate further as the economy continues to tumble.

In London today at 16.42pm today (November 13) the Pound was trading at $1.4794 this is the lowest since June 2002, the Pound against the euro tumbled 84.69p from 83.56. Other European countries are feeling the strains of the global crisis with Germany confirming they are now in recession.

Source: Bloomberg