From 3h ago
07.53
Pound drops below $1.16
Sterling has fallen to its lowest level against the US
dollar since the pandemic crash in March 2020, as anxiety over the UK economy
rises.
The pound
has dropped as low as $1.1565 this morning, as the energy crisis hammers
businesses and consumers, hurting Britain’s economic outlook.
The selloff
comes after the pound racked up its worst month against the dollar since
October 2016.
Fears that
the UK is heading into recession pushed sterling down by 4.5% against the
dollar during August; the dollar continues to strengthen as America’s central
bank vows to keep raising interest rates.
Naeem Aslam
of Avatrade says sterling is getting “absolutely battered” against the dollar,
led by concerns over the cost of living crisis.
Consumers
in the UK are squeezed to such a level that we have not seen in nearly a
century, and the hope is that the new Prime Minister will deliver some sort of
relief package, which should be in billions, to ease off the current crisis.
Liz Truss,
the most favorite among bookies as the next Prime Minister, has already ruled
out any tax hikes for this year or rationing of energy in the coming winter.
Her second promise look shaky because the energy crisis is pretty much
unavoidable, and it would be highly difficult to avoid energy rationing.
Nonetheless,
the most important thing which matters for consumers is not energy rationing
but, in fact, a support package that can ease off their living standards.
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