Pound plunges to January depths

Pound sterling plummeted to its lowest level against the dollar since January today driven by traders gearing their portfolios toward safer assets.

The pound lost ground on the greenback, dipping 0.06 per cent to buy $1.3527.

The pound tends to move in line with global equity markets. Stocks suffered heavy hits yesterday, driven by investors preparing for rate hikes from rich countries’ central banks.

Severe worker shortages and supply chain snarl ups are intensifying inflationary pressures in the UK, which is putting downward pressure on the pound, according to Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown.

“The worry that the UK won’t quickly break free from the constraints caused by driver shortages and the bottlenecks of goods and raw materials, has seen the pound struggle to recover from its slide against the dollar.”