The pound dropped to a record low against the euro on Monday, as money markets digested warnings from Alistair Darling that the economic times the UK faces “are arguably the worst they’ve been in 60 years”.

The pound’s fall, which was exacerbated by more weak economic data, came as traders said that sterling was set increasingly to bear the brunt of the UK’s economic slowdown. It dropped to a low of £0.8139 to the euro, its weakest level since the single currency’s inception in 1999.