| GEO Business | | UK pound falls to record low vs euro | Updated at: 0206 PST, Thursday, December 11, 2008
LONDON: Britain's pound fell to a record low against the euro on Wednesday as fears about the strength of the British economy grew.
The British currency dipped just under euro1.14 -- the weakest it has ever been against Europe's shared currency since the euro was launched in 1999.
The record low comes on the same day that the British National Institute of Economic and Social Research, a leading think tank, published a report estimating that Britain's economy shrank by a greater-than-expected 1 percent in the three months through November.
The report predicted that the pace of economic contraction would accelerate in the quarter through December, landing the country in a technical recession -- defined as two or more consecutive quarters of negative growth.
The Bank of England has also sharply cut interest rates -- a move that can weaken demand for a country's currency by reducing the yield on interest-bearing investments. |  |
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