The British pound has slumped against the euro and the dollar as investors assess the economic outlook, despite the London stock market striking its highest level for more than a year.
This evening the euro was up to 93.6 pence.
Sterling fell to its lowest in seven months against a basket of currencies, as the British government plan to sell off £16 billion of assets served as a reminder of how bleak the outlook is for UK public finances.
Today Prime Minister Gordon Brown today announced the initial round of sales, estimated to raise £3 billion.
The asset sale plans were flagged long ago, but the details came in a session devoid of major economic data or events, leaving traders to maintain their bearish view on the currency.
A report from the consultancy Centre for Economics and Business Research also said interest rates could stay at the record low of 0.5% until 2011, and that the pound could fall to $1.40 and possibly below parity with the euro.
