By Rocky Vega
10/13/09 Stockholm, Sweden – Coverage of the dollar devastation keeps pouring in… but, another interesting story unfolding is in the pound, which actually hit a four-month low versus the dollar on Monday. To put this into perspective, there aren’t many major currencies hitting lows right now against such a weakened dollar.
Like the US, the UK economy has been heavily dependent on the financial services sector, is also running a deep fiscal deficit, and is keeping interest rates extremely low. Worse still, the UK treasury is now projecting its net debt to reach 80 percent of GDP by roughly 2015.
The pound is also at new 24-year lows versus the New Zealand and Australian dollars. It’s probably not the nicest thing to say in a situation like this… but misery does love company.
The Wall Street Journal has more details in its article on the sterling taking a beating.
Rocky Vega is a regular contributor to The Daily Reckoning. Previously, he was founding publisher of UrbanTurf and RFID Update, which he operated from Brazil, Chile, and Puerto Rico, and associate publisher of FierceFinance. He specialized in direct marketing at MBI, facilitated MIT Sloan School of Management programs, and has been featured on CBS. Vega graduated with honors from Harvard University, where he was on the board of Let’s Go Publications and directed business programs involving McKinsey, Goldman Sachs, and Harvard Business School faculty. He is also enrolled at the Stockholm School of Economics.
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