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Sterling falls against US dollar for 11 straight days

Catherine Deshayes

Eleven days of consecutive falls is the longest run of losses for the British pound against the American dollar in 37 years

Back in mid-July, £1 would buy $2, but the pound has since fallen off sharply in the light of comments from the Bank of England.

The bank's Governer, Mervyn King, said that growth in the UK could be flat for the next year and that inflation could touch 5% before starting to fall.

The pound is now at its lowest level since 1996, hitting $1.855 last Friday, whilst the dollar continued to strengthen, welcome news in the light of the country's subprime crisis, achieving a six-month high against the euro.

 Widespread concern that the slowing economy is a global trend, rather than one only affecting America, has led to some international investors shying away from using the pound or euro, hence the falls.

One group of people the falling pound will help is the  exporters whose goods will be cheaper overseas.

It will hinder travelers who relied on the strong pound when visiting countries which use the dollar. Their holidays will now become far more expensive.