30th December 2011
The sterling fell against the dollar in forex trading on Thursday (December 29th), dropping to a two-and-a-half month low versus the greenback.
According to Reuters, the pound slipped 0.3 per cent on the day to $1.5397 - its lowest level since early October - as model-related funds and real money investors sold the British currency.
Constant sterling offers on electronic trading systems were reported by traders, while specific demand for euro/sterling meant the pound remained under constant pressure.
Signs of slowing economic activity and flat growth forecasts have had a negative impact on the currency, sparking speculation that the Bank of England will extend its quantitative easing (QE) programme.
Howard Archer of IHS Global Insight told the Financial Times it is "odds-on" that the central bank will implement more QE in early 2012 in a bid to help the economy.
"We expect a further £50 billion in February, taking the total to £375 billion and it is highly possible the bank could ultimately take the stock of QE even higher," he added.
Begin trading today! Create an account by completing our form
At One Financial Markets we are committed to safeguarding your privacy.
Please see our Privacy Policy for details about what information is collected from you and why it is collected. We do not sell your information or use it other than as described in the Policy.
Please note that it is in our legitimate business interest to send you certain marketing emails from time to time. However, if you would prefer not to receive these you can opt-out by ticking the box below.
Alternatively, you can use the unsubscribe link at the bottom of the Demo account confirmation email or any subsequent emails we send.
By completing the form and downloading the platform you agree with the use of your personal information as detailed in the Policy.