UK currency under severe pressure as debts begin to mount
After a very brief recovery on the currency exchange over the last few days the pound has encountered some serious selling pressure today falling to a seven-year low against the dollar. There is concern amongst traders and investors that the constant drip feed of taxpayer's money into various rescue packages is severely weakening the power of the UK and investment prospects.
The banking sector also came in for a renewed bout of selling pressure today with Lloyds TSB shares falling by around 50% early in the day only to stage a late recovery. Barclays bank was also another of the major UK institutions under serious pressure as speculation regarding substantial write-offs continues to mount.
If we look back only a couple of months there was hope in the currency and stock markets after Gordon Brown announced a revolutionary idea to allow the government to take substantial stakes in the U.K.'s leading banks. However, the tens of billions of pounds poured into the system in exchange for shares has now turned sour and the substantial banking stakes are now worth only a fraction of the amount invested.
The government is fast running out of ideas to refloat the economy which is affecting both the currency market and the stock market.
Share this..
Related stories
Inflation falls less than expected
The rate of inflation in UK, as measured by the Consumer Price Index (CPI), fell last month to 2.2% from 2.3% the previous month. Analysts had expected a more significant fall to around 1.9% and the recent strength would seem to indicate that the prospect of deflation is lessening by the month. The Retail Price Index (RPI) inflation measurement is already in negative territory although it edged up...
Read MoreAre we talking ourselves into another downturn?
As the chief executive of Unilever issues are very downbeat assessment of the global economy there are growing concerns that we are on the verge of talking ourselves into another downturn. Only a few weeks ago investors were happy to pour money into the UK stock market with high hopes that the economy had turned the corner and the global situation was recovering. However, only a few weeks down the...
Read MoreIs the UK government about to be embarrassed over the Icelandic affair?
Amid claims that the government were aware of problems in Iceland prior to the collapse of the country's financial sector there are growing calls for a thorough investigation into the collapse where confirmation about what the government did and did not know would be requested. As we discussed yesterday there are claims that Gordon Brown knew about problems as far back as March 2008 although no ac...
Read MoreCo-op to lay off 1,000 workers
Co-operative Financial Services (CFS) has announced that it will lay off 1,000 employees this year in order to cut costs to fund a £250 million growth programme.The programme aims to expand the company's operations in retail, corporate banking and general insurance.CFS which consists of the Co-operative Bank and internet bank Smile, hopes to reduce its operating costs by £100 million by June 200...
Read MoreIs the UK becoming a divided society?
A recent TUC report has suggested that the UK society has become one of the most unequal and diverse in Europe over the last 30 years. In a move which is probably designed to highlight the fact that the rich get richer and the poor get poorer, the study appears to show those in the "middle earners" bracket have seen their incomes fail to keep pace with middle-class workers and those in higher paid...
Read More