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Sterling plunges against dollar Pound struggles after sharp fall
(about 14 hours later)
Sterling has fallen sharply against the dollar as yet more bad economic data points towards a prolonged recession and further interest rate cuts. Sterling has slipped again against the US dollar after a massive fall on Monday - the largest in percentage terms since 1992.
The pound was down 5.2 cents to $1.486, its largest one day fall in percentage terms since sterling crashed out of the Exchange Rate Mechanism (ERM) in 1992. The pound was trading at $1.479, as against $1.483 at the previous close.
Sharp falls in the FTSE 100 index - down 5.2% on Monday - also served to undermine the currency. On Monday it fell 5.2% against the dollar as yet more bad economic data pointed towards a prolonged recession and further interest rate cuts.
The pound was also down 3.5 cents against the euro, at 0.851 pounds. Sterling was almost steady against the euro on Tuesday, at 1.176, compared to 1.174 euro on the previous day.
POUND STERLING v UNITED STATES DOLLAR: 02 December 2008*All Times GMT
The pound's fall on Monday was the largest since the sterling crashed out of the Exchange Rate Mechanism (ERM) in 1992.
Sharp falls in the FTSE 100 index - down 5.2% on Monday - served to undermine the currency.
The poor economic data increases the likelihood that the Bank of England will cut interest rates on Thursday.The poor economic data increases the likelihood that the Bank of England will cut interest rates on Thursday.
HSBC confirmed on Monday it is cutting 500 jobs across the UK, while carmaker Aston Martin announced it will cut 300 full-time and 300 temporary jobs.HSBC confirmed on Monday it is cutting 500 jobs across the UK, while carmaker Aston Martin announced it will cut 300 full-time and 300 temporary jobs.
Mortgage approvals also fell in October, according to figures released by the Bank of England, suggesting house prices may fall even further.Mortgage approvals also fell in October, according to figures released by the Bank of England, suggesting house prices may fall even further.