Sterling sinks against the US Dollar and Euro

Commenting on Sterling's increasing weakness against the US Dollar and Euro, Stephen Heath, Chief Executive at FairFX.com, said: "It was an horrific start to the week for the British currency, as the pound sank further against the greenback on Monday alone than at any time in the past 15 years. Many market players held the collapse of Bradford and Bingley solely responsible.

"As the pound collapsed from $1.84 to $1.79, a fall of 2.7 per cent, the Bank of England started to face growing pressure to cut interest rates ahead of the MPC meeting in October. However, it is too early to say whether rates will be cut; at the moment it seems a rate cut is likely, but this could change in the blink of an eye. All we really do know is that a rate cut would not do any favors to the sinking Pound."