LONDON: The pound yesterday struck an all-time low against the euro after Britain’s finance minister gave a bleak assessment of the economy ahead of a Bank of England interest rate decision due this week.
In London trade, the European single currency was trading at 81.11 pence around 1600 GMT after hitting 81.38, the best level versus sterling since the euro’s creation in 1999.
The British pound meanwhile fell to 1.8009 dollars, after hitting the lowest level since April 2006. “The current weakness of sterling accurately reflects the present situation of the British economy,” said Commerzbank analyst Lutz Karpowitz.
“All indicators seem to suggest that the economy will unavoidably slide into recession.” Chancellor of the Exchequer Alistair Darling warned in an interview published at the weekend that Britain faced “arguably the worst” economic downturn in 60 years and it would be “more profound and long-lasting” than expected.
