The British pound reached a three-month low on Wednesday ahead of UK general election, the most closely fought polls in a generation.
Sterling tumbled about 4% against the euro last week, with dealers saying many in the market finally choosing to run short of the currency.
Against the euro and the US dollar, the pound closed at 74.47 pence and $1.5245, respectively.
It makes a lot of sense the euro is surpassing the pound “the day before a massively uncertain general election,” said Hamish Pepper, Currency Strategist at Barclays.
Banks have been one of the highlights in this year’s election campaign, with Labour intending to crack down on banks and huge businesses and Conservatives’ pledge of an in-out referendum on the EU membership.
Earlier, a better than projected survey of purchasing managers in services sector bolstered the currency, countering other signs the British economy was slowing down.
The material has been provided by InstaForex Company – www.instaforex.com