British pound falls to its lowest level against the dollar since 1985

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The British pound has fallen to its lowest level against the U.S. dollar. The currency fell 0.64% to $1.145 on Wednesday afternoon, a level not seen since 1985.

The United Kingdom is said to be battling double-digit inflation, an energy crisis, and a possible recession.

Andrew Bailey, governor of the Bank of England highlighted that a weaker outlook for the UK economy as well as a stronger dollar were putting pressure on the sterling.

Bailey also warned that little could be done to stop the UK falling into a recession this year as the war in Ukraine continued.

The last time sterling fell to $1.14 was briefly in March 2020 and the Brexit result in 2016. The level of $1.1407 has not been seen since 1985, under Margaret Thatcher’s government.

The British pound has been hammered over recent months by surging inflation — currently at the highest level among all G-7 nations — and the prospects of a looming recession.

The appointment of Truss, who is widely expected to cut taxes and boost borrowing, has added to U.K. debt market concerns.

 




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