The UK Pound fell this week to its lowest value against the US Dollar in five years as news of an economic slowdown in the country fueled its drop. The British currency also fell against the euro as Prime Minister Gordon Brown predicted the UK will slip into a recession.
At the end of the day on October 22, the pound was worth just over $1.61, but it looked to pick up a little ground in overnight trading. During the day it fell to its lowest value against the dollar since September, 2003. Earlier in 2008, and for much of 2007, the pound was worth over $2.00.
The currency’s fall came on the heels of a speech that Bank of England governor Mervyn King gave to a group of business leaders in Leeds earlier in the week. He noted that the economy is shrinking and indicated there may be more interest rate cuts on the way. The prime minister then said the next day that the global credit crisis will probably push the Britain into a recession.
The pound was worth €1.2761 at one point, and the euro itself has slid against other currencies. It hit a four and half year low against the Japanese yen and is at its lowest value against the dollar in nearly two years.
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