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British Crisis Pushes Pound Further Down

March 2, 2010 at 4:16 by Jan Baros

Great Britain poundThe pound didn’t manage to pare last week’s losses versus most of the 16 main traded currencies this Monday, as not only the financial, but the political situation in the U.K. is rather negative, impacting the already not very attractive assets in the country.

Several events pushed the pound further down today as the country may have a minority government for the first time in 35 years, which would slow down measures to be imposed with efficacy to prevent the current fiscal crisis in the country to grow. A report this week is likely to show a decline in Britain’s consumer confidence, and the pound is posting its sharpest falls versus the Aussie dollar as the South Pacific nation is likely to hike its benchmark interest rates this week.

The pound is becoming the center of pessimistic thoughts in Europe, as the Greek crisis’ emotional effects in financial markets started to cool down. The U.K.’s government certainly will have a lot of challenges to face this year, and this will certainly have a cost for the pound in forex markets.

GBP/USD traded at 1.4933 as of 02:11 GMT from a previous intraday rate of 1.5153.

If you have any questions, comments, or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

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