Financial Times FT.com

Fiscal and political fears hit sterling

By Peter Garnham

Published: March 1 2010 11:12 | Last updated: March 1 2010 22:59

Sterling was hammered on foreign exchange markets on Monday as investors reeled from the prospect of a hung parliament following the British general election, expected in May.

The pound dropped nearly four cents in a frantic two hours of morning trading. As it fell below the key $1.50 level, it triggered a wave of speculative selling in the currency. Traders said worries over the UK’s fiscal position were the driving force behind sterling’s fall.

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