British Pound plummets to record low against American Dollar

British Pound plummets to record low against American Dollar

The British pound crashed to a record low against the US dollar on September 26 amid growing fears of stability in UK government finances.

The pound plunged approximately 5% to $1.0327 at one point: the lowest since Britain went decimal in 1971.

The pound fell below $1.10 for the first time since 1985 with new finance minister Kwasi Kwarteng’s controversial mini-budget.

Source: Twitter

Kwarteng planned to cut taxes to uplift the British economy and provide cash to cushion families struggling with inflation.

Equity markets across Asia and Europe fell again in view of a growing expectation that central bank interest rate hikes will fight inflation.

Investors also expressed fear over a huge amount of borrowing needed for the multi-billion-pound package.

Observers are expecting the pound to fall even further.

The sterling's collapse has also come as global markets grapple with recession worries triggered by tightening of monetary policy.