Tuesday, February 7, 2023

Pound falls further in Asian trading on Monday


London, June 27 (IANS) The British pound has fallen sharply in trading in Asia on Monday, adding to Friday’s record one-day decline.

The pound was trading at $1.3365, down almost 3 per cent from Friday’s close. Against the euro it was trading at 1.2147, down 1.4 per cent, BBC reported.

On Friday the pound had its biggest one-day fall against the dollar, at one stage sinking as low as $1.3236.

Chancellor of the Exchequer, George Osborne will issue a statement before the start of trading in Britain in a bid to calm the markets.

Osborne has not spoken publicly since the ‘Leave’ campaign won Thursday’s referendum paving the way for Britain’s exit from the European Union (EU).

Authorities in Asia have been taking action to stabilise financial markets.

After an emergency meeting on Saturday, Japan’s finance minister Taro Aso said that he has been instructed by Prime Minister Shinzo Abe to take steps to stabilise the currency markets if

“Risks and uncertainty remain in financial markets,” Abe said.

The rising value of the yen is a concern to the Japanese government, as it makes the nation’s exports less competitive.

After plunging almost 8 per cent on Friday, Japan’s benchmark share index, the Nikkei 225, added 1.3 per cent on Monday.

In China, the central bank weakened the official value of the yuan by 0.9 per cent, the biggest move for the currency since August 2015.

Jeremy Cook, chief economist at World First, said: “We are still looking for another 10 per cent fall for the pound against the dollar in the coming months as data confirms the economic slowdown and monetary policy expectations increase.”

Traders will be watching Britain’s financial position closely over the coming months.

“The funding position of the UK, with its twin current account and fiscal deficits, are the next pressures to weigh,” Cook added.

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