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Pound declines amid increasing factory prices
The UK's currency has continued to slide against the dollar following the release of government data highlighting an increase in factory prices during April.
Trading at £1.9800 against the dollar last night, the sterling also fell against the euro to £0.6840.
Currency strategist at BNP Paribas, Ian Stannard, told Reuters: "I expect sterling to keep under a little bit of pressure over the next couple of days but I think longer-term we're still going to see cable moving higher."
The government figures are raising concerns that the increased factory prices could be passed on to consumers, the publication suggests, adding that the pound was remaining low on additional worries over further interest rate hikes by the Bank of England.
Meanwhile, the euro may be affected by forthcoming growth reports from Germany and the Eurozone. The area's annualised growth rate is predicted to slip to 3.1 per cent from 3.5 per cent while Germany's GDP is expected to fall to 0.3 per cent from 0.9 per cent in the previous quarter.
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Sterling hits one week low against dollar and euro
Wed, 10 Mar 10, 14:34
The leading event in the forex market today has been the sudden dip in the value of the pound and as today's unexpectedly dismal industrial and manufacturing reports from the UK added further weight onto the struggling currency.