Sterling falls to a 31-year low while gold jumps amid ongoing Brexit concerns

James Nickerson
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The pound is continuing its slide (Source: Getty)

The British pound fell to fresh 31-year lows against the dollar and multi-year lows against a host of other currencies this morning.

After closing two per cent lower at $1.3022 yesterday, it hurtled to break through the $1.30 barrier again this morning for the first time since 1985.

It hit a new low of $1.2798, though has rebounded slightly to $1.2907.

"The pound has continued to come under pressure in the past couple of days sinking to new 31 year lows around the 1.2800 level against the US dollar and multi-year lows against the yen and the euro as well," said Michael Hewson, chief markets analyst at CMC Markets.

Read more: Sterling sinks below $1.30 for the first time in over three decades

Yesterday the pound wasn't helped by a number of commercial property funds (Standard Life, Aviva and M&G) that suspended trading. The slide is thought in part to be due to a possible crash in commercial property prices after the Brexit vote.

It also fell as governor of the Bank of England Mark Carney reiterated his belief that interest rate cuts or more quantitative easing would be needed.

Yesterday, while acting as de-facto leader of the UK, he also drew attention to some of the wider implications of the Brexit vote for the economy.

Angus Nicholson, a market analyst at IG in Melbourne, said: "Mark Carney, almost the only British leader who seems to not be resigning at the moment, emphasised the challenges the UK economy will suffer in the post-Brexit world. Carney's speech seems to have initiated the dawning of realisation of the longer-term impact of Brexit for many in the markets."

Read more: Aviva and M&G become the latest property funds to suspend trading as investors flee the Brexit-battered industry

Yesterday the Bank of England said it was easing capital requirements for banks, thereby freeing up £150bn for lending.

Gold - as you might expect - surged to its highest price since March 2014, asking as much as $1,371.40 an ounce.

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