Sterling is 'in the global doghouse'

Last week, the pound hit a five-month low against the euro and fell by 2.6% against the dollar. And it looks like sliding further still.

When risk appetite is high, sterling usually does well. But this time the pound "has not been invited to the party", says Deborah Hyde on Citywire.co.uk. In fact, it's "in the global doghouse", says Jim Wood-Smith of Williams de Bro, hitting a five-month low of around £0.90 to the euro and falling by 2.6% against the dollar last week.

Sentiment was hurt by the Bank of England's (BOE) announcement that it might lower the interest rate that it pays on deposits that banks hold with it; the idea was taken as a sign that the policymakers think quantitative easing (QE) isn't working as well as they hoped. In turn, this also increases the odds of interest rates staying at record lows for a long time.

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