Abbey: Pound hits 26 year high against the dollar

Barry Naisbitt, Abbey's Chief Economist comments on the pound hitting a 26 year high against the dollar: "Today the pound hit its highest level against the dollar in 26 years, as high as $2.066 in early trading.

Exchange rates are volatile and notoriously difficult to predict, and it may be that the expectation of a further rate cut in the USA has played a role in lowering the dollar. Those who are planning to take winter breaks in the USA will be pleased to find that their pound will go further towards there Christmas shopping. As with many things in economics, however, there is a balance to be struck. UK exporters looking to sell goods in the US will find that the stronger value of sterling could reduce their sales growth."