The pound is at its worst exchange rate against the euro in the single currency’s nine-year history, making goods imported from the eurozone more expensive than ever.
The euro was worth more than 80p on Wednesday - the seventh time the pound has hit a record low against the euro since March. And the International Monetary Fund has warned that the world economy would suffer further as the US heads into recession.
The reduction in value of the pound against the euro is down to the European Central Bank holding interest rates steady since June, while the Bank of England has made two cuts, with another looming this week.
In anticipation of the Bank of England trimming interest rates to 5.0 per cent from 5.25 per cent today [Thursday], the pound dipped as low as 1.2500 euros in early Wednesday trading.
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