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Pound slumps to 31-year low versus dollar


The British pound. (AFP File Photo)

The British pound. (AFP File Photo)<br />

The pound slumped to a 31-year low against the dollar Tuesday on concerns over the timing of Britain’s planned exit from the European Union, according to traders.

Britain’s currency also struck a fresh three-year low point against the euro, while the drops helped pushed London’s benchmark FTSE 100 stocks index up to a 16-month high beyond 7,000 points at the open.

Around 0725 GMT, the pound struck $1.2757 — the lowest level since 1985.

Sterling meanwhile traded at 87.56 pence to the euro — its weakest level since 2013.

“It seems that it is going to be hard to provide a tourniquet for sterling’s recent wounds given the solidity of the newly announced Brexit timeline,” said Connor Campbell, analyst at traders Spreadex.

“In terms of silver linings the pound’s protracted demise has continued to lift the multinationals that make up the FTSE 100, leaving the index back above 7,000 for the first time in 16 months.”

The FTSE rallied to a gain of 1.1 percent at 7,060.46 points in early deals compared with Monday’s close.

In the eurozone, Frankfurt’s DAX 30 stocks index won 0.6 percent to 10,577.94 points compared with Friday’s close. The DAX was shut Monday owing to a public holiday in Germany.

The Paris CAC 40 meanwhile opened Tuesday with a gain of 0.7 percent at 4,485.41.

British Prime Minister Theresa May announced at the weekend that her government would start the process of leaving the EU within the next six months — possibly leading to Britain severing ties with the single market.

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