Currency Exchange UK

 

Pound Falls after Monday Gains

Pound Falls after Monday Gains

After having risen on Monday against the US dollar, the pound fell against both the dollar and the euro in this morning’s early trading. 

Against the dollar, it was down to $1.6064, a retreat of 0.2 per cent and while the euro edged up to 89.76 pence.

According to analysts, the main reason for the pound’s retreat was fears over the future of the UK economy as election campaigns commence.

Many economists warn that unclear leadership over the massive UK debt problem and the generally weak economy could weigh very heavy on the pound this year.

On Monday, the picture looked more positive for the UK’s currency: after good data from the manufacture sector and an upward trend for mortgage approvals, the pound rose against the dollar.#

However, overall there are still concerns over the British economy especially when compared to the US, where there are better signs of recovery. 

In June this year, the UK will undergo a general election and this year for the first time in a while there is a strong danger for the Labour party that they will not win another term. 

This political situation – of a strong contender in the Tory party and their plans to rescue UK debt – is likely to keep financial and currency markets jittery for some time.