Pound hits record low against dollar on recession fears

Agence France-Presse

Posted at Sep 26 2022 11:09 AM

A worker holds a Pound sterling banknote at a money exchange company in Peshawar, Pakistan, 23 September 2022. The British pound fell more than 2 percent against the Dollar on 23 September after the British government announced a radical economic plan to boost growth. EPA-EFE/ARSHAD ARBAB
A worker holds a Pound sterling banknote at a money exchange company in Peshawar, Pakistan, 23 September 2022. The British pound fell more than 2 percent against the Dollar on 23 September after the British government announced a radical economic plan to boost growth. EPA-EFE/ARSHAD ARBAB

HONG KONG - The pound plunged to a record low against the dollar on Monday as traders grow increasingly fearful of a deep UK recession after new finance minister Kwasi Kwarteng unveiled a controversial tax-cutting mini-budget.

Sterling dropped to as low as $1.0350 in early Asian trade, according to Bloomberg data, with some commentators warning it could sink to parity with the greenback.

Investors began dumping the pound on Friday after Kwarteng, who was put in place by Liz Truss after she became prime minister earlier this month, set out plans to slash taxes in a bid to kickstart the ailing British economy.

And the selling continued on Monday after he said he intended to unveil further reductions, despite his budget causing ructions on London's markets, with the FTSE 100 losing around two percent.

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