Page last updated at 22:09 GMT, Monday, 9 March 2009

Pound slides as bank shares hit

Dollars

The pound has sunk back below $1.40 to a six-week low, as confidence in the UK economy took yet another knock following falls in bank shares.

The pound was down almost four cents at $1.3776. Sterling touched its lowest levels in 24 years in mid-January, nearing $1.35.

UK financial shares fell in Monday trading after the government increased its stake in Lloyds Banking Group.

Against the euro, the pound was down over two cents at 1.0927 euros.

Shares in Lloyds fell more than 10%, before recovering during afternoon trading to end the day up 4.1%.

Barclays lost 13% before bouncing to end down 5.3%.

What's going on in UK shares at the moment is putting pressure on sterling
Geraldine Concagh, AIB

Other banking stocks among the day's biggest losers included HSBC, down 3.3%, and RBS, which fell 4%.

'Downward pressure'

"What's going on in UK shares at the moment is putting pressure on sterling," said Geraldine Concagh at AIB Group Treasury.

She added that the Bank of England's programme of quantitative easing will put further downward pressure on sterling.

The taxpayer will soon own 65% of Lloyds Banking Group - up from the current 43%.



Print Sponsor



FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC iD

Sign in

BBC navigation

Copyright © 2016 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific