The pound fell to its lowest level against the dollar in more than four months yesterday as the so-called ‘Trump trade’ put further pressure on global markets.
Sterling was at $1.2627, its weakest level since July 2.
On the day Americans went to the polls last week, the price fell from above $1.30.
Dollar Rally: Sterling reached $1.2627, weakest since July 2. It has fallen from above $1.30 on the day Americans went to the polls last week
The strength of the dollar in the wake of Donald Trump’s election victory has also hit the euro, which yesterday fell to its weakest level against the dollar since October last year, at less than $1.05.
The U.S. currency has risen as the president-elect’s promises of tax cuts and rate hikes fuel inflation fears – meaning U.S. interest rates may stay higher for longer.
Matthew Amis, investment director at fund manager Abrdn, said: ‘The “Trump trade” has returned to the market after initial faltering, and the US dollar has been the main beneficiary.’
Cryptocurrency bitcoin has been a big winner amid bets that a Trump presidency will mean friendlier regulation of the asset class.
But it is still subject to the volatile swings for which it has become infamous.
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