Connect with us

News

British Pound Hits Record Low Against Dollar After U.K. Signals More Tax Cuts

Avatar of Arsi Mughal

Published

on

British Pound Hits Record Low Against Dollar After U.K. Signals More Tax Cuts

(CTN News) – In reaction to the UK’s biggest tax cuts in 50 years, the pound has fallen to a record low against the dollar.

On Monday morning, UK time, sterling fell close to $1.03 before recovering some ground to stand at about $1.07.

On top of a £45bn package announced on Friday, Kwasi Kwarteng promised more tax cuts.

Government borrowing costs continued to Erise on Monday as well.

Oil and gas will cost more to import if the pound stays at this low level against the dollar.

In addition, American goods could also be significantly more expensive, and British tourists will find that their holiday money won’t stretch as far as it did before the sterling’s slide.

Tax cuts and borrowing billions by the government threaten to stoke inflation and force the Bank of England to raise interest rates even further.

Millions of homeowners would see their monthly mortgage costs rise as a result of this.

126846648 dollar 26 sep nc

Why the falling pound matters

Every day, investors trade huge amounts of foreign currency. Exchange rates at banks, post offices, and foreign exchanges are also determined by the rate at which investors swap currencies.

Most people don’t think about exchange rates until they need to exchange money for a foreign vacation. Traveling abroad will be more expensive if the pound is worth less than the local currency.

A fall in the pound affects household finances as well.

A weaker pound increases the cost of importing goods from overseas.

Petrol, for instance, is priced in dollars, so a weak pound can make it more expensive to fill up your car. Dollars are also used to price gas.

iPhones, for example, made overseas, may be more expensive in UK stores. Buying parts from abroad can even increase the cost of things that are made in the UK.

Related CTN News:

Tropical Storm Noru is About to Hit Thailand’s North-East this Thursday

Is Crypto Becoming Less Popular As a Payment Method?

 

Arsi Mughal is a staff writer at CTN News, delivering insightful and engaging content on a wide range of topics. With a knack for clear and concise writing, he crafts articles that resonate with readers. Arsi's pieces are well-researched, informative, and presented in a straightforward manner, making complex subjects accessible to a broad audience. His writing style strikes the perfect balance between professionalism and casual approachability, ensuring an enjoyable reading experience.

Continue Reading

CTN News App

CTN News App

Recent News

BUY FC 24 COINS

compras monedas fc 24

Advertise here

Volunteering at Soi Dog

Find a Job

Jooble jobs

Free ibomma Movies