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| Version 0 | Version 1 |
|---|---|
| Pound extends losses against euro | Pound extends losses against euro |
| (21 minutes later) | |
| The pound has fallen sharply against the euro and the dollar after the head of the Bank of England said a weak currency was "helpful" to the economy. | The pound has fallen sharply against the euro and the dollar after the head of the Bank of England said a weak currency was "helpful" to the economy. |
| The pound fell to 1.0947 euros, its lowest since early April, and dropped by about a cent to $1.6172. | The pound fell to 1.0947 euros, its lowest since early April, and dropped by about a cent to $1.6172. |
| Bank governor Mervyn King said in a newspaper interview that a fall in the exchange rate would help to balance the UK economy by giving exports a lift. | Bank governor Mervyn King said in a newspaper interview that a fall in the exchange rate would help to balance the UK economy by giving exports a lift. |
| Analysts said the pound was likely to fall further against the euro. | |
| The pound has weakened in recent days on fears about the high level of UK debt. | The pound has weakened in recent days on fears about the high level of UK debt. |
| However, the pound is still well above the levels hit early in the year when it traded below $1.50 against the dollar. | However, the pound is still well above the levels hit early in the year when it traded below $1.50 against the dollar. |
| 'Downward spiral' | 'Downward spiral' |
| Mark O'Sullivan, director of dealing at Currencies Direct said Mr King's comments indicated that the central bank was in favour of a weak pound. | Mark O'Sullivan, director of dealing at Currencies Direct said Mr King's comments indicated that the central bank was in favour of a weak pound. |
| "If we continue to see the pound being talked down from the top then the downward spiral towards parity with the euro will continue apace," he said. | "If we continue to see the pound being talked down from the top then the downward spiral towards parity with the euro will continue apace," he said. |
| Mr King also told the Journal newspaper in Newcastle that UK economic growth was beginning to pick up, but said people should not get carried away. | Mr King also told the Journal newspaper in Newcastle that UK economic growth was beginning to pick up, but said people should not get carried away. |