This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7069087.stm

The article has changed 10 times. There is an RSS feed of changes available.

Version 0 Version 1
Pound hits 26-year US dollar high Pound hits 26-year US dollar high
(10 minutes later)
The UK pound has hit its highest level against the US dollar in 26 years.The UK pound has hit its highest level against the US dollar in 26 years.
The move comes as investors bet that the US Federal Reserve will cut interest rates later this week.The move comes as investors bet that the US Federal Reserve will cut interest rates later this week.
That would help strengthen the pound as higher interest rates in the UK would attract inflows of funds keen to benefit from better rates of return.That would help strengthen the pound as higher interest rates in the UK would attract inflows of funds keen to benefit from better rates of return.
The pound rose as high as $2.066 in earlier trading, before paring gains slightly to $2.064. The pound also gained against the euro.The pound rose as high as $2.066 in earlier trading, before paring gains slightly to $2.064. The pound also gained against the euro.
Many analysts expect the Federal Reserve, the US version of a central bank, to cut interest rates by a quarter of a percentage point on Wednesday in an attempt to limit the impact of a housing market slowdown.
The Fed has already cut its main interest rate to 4.75% last month after problems in the housing market were seen to be spreading to the wider economy.
House prices have been falling and the number of foreclosures has surged in recent months after the Fed raised rates in an attempt to slow inflation.
While inflation has been a problem in previous months, many analysts now say that the biggest worry is consumers reining in their spending.
Should that happen, they argue, then the US economy could splutter into a recession.