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Pound Plunges to Record Low Against Euro

Gloomy economic outlook sends British currency tumbling

By Rob Quinn, Newser Staff

Posted Sep 2, 2008 2:26 AM CDT

(Newser) – The British pound has sunk to its lowest level ever against the euro since the European currency was introduced in 1999, the Financial Times reports. The fall follows Chancellor Alistair Darling's dire warning that the outlook for the British economy is the worst in 60 years. The pound dropped to $1.79 against the dollar, its lowest since April 2006.

The pound suffered its biggest fall against the dollar in 16 years last month when figures were released showing the British economy staggering. Government officials have downplayed the significance of the chancellor's comments—sparking rumors that Darling may soon be joining the rising numbers of jobless. But economic analysts say the UK economy appears to be unavoidably headed for recession.

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The British pound has tumbled to a record low of £0.8139 against the euro following gloomy predictions for the country's economy. ((c) jonanamary)

The British pound has fallen against the US dollar and euro. (AP Photo/Nick Ut)

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The current weakness of sterling accurately reflects the present situation of the British economy. All indicators seem to suggest that the economy will unavoidably slide into recession. - Lutz Karpowitz of Commerzbank.

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Pound Plunges to Record Low Against Euro