10th April 2015
The pound has hit a new five-year low against the dollar as figures from the Office of National Statistics (ONS) warned the recovery was slowing in the run up to the election
Sterling dropped to $1.462, its lowest point since June 2010 just after the last general election.
The fall was prompted by figures from the ONS showing UK industrial output was just 0.1% in February, below the 0.3% expected; it also follows a 0.1% contraction the previous month.
Output in construction also fell by 0.9% following a 2.5% contraction in January.
This has lead experts to suggest that the official GDP figures, to be published a week before the election, will point to a weakening in the UK’s economy recovery.
The figures released today show growth has slowed overall to 0.4% in the first question, down 0.6% in Q4 last year.
Dennis de Jong, managing director of UFX.com, said the figures would ‘heap more pressure on the pound’.
‘We’ve seen in the past few days sterling fall to well below the $1.5000 mark and, with the election on the horizon, the pound could drop further against the greenback,’ he said.
‘On the whole the UK economy is resilient, but with Labour doing better in the polls the markets are likely to get increasingly jittery as we approach 7 May.’