Pound slumps to new low against Singdollar on mounting signs of weakness in post-Brexit UK economy

The British pound slumped to a fresh three-year low against the euro on August 15 and edged lower on the dollar, as signs of weakness mounted in the British economy.
The British pound slumped to a fresh three-year low against the euro on August 15 and edged lower on the dollar, as signs of weakness mounted in the British economy.PHOTO: EPA

NEW YORK (AFP) - The British pound slumped to a fresh three-year low against the euro on Monday (Aug 15) and edged lower on the US dollar, as signs of weakness mounted in the British economy.

At 86.80 pence on the euro, the pound was at its weakest level since August 2013.

Meanwhile sterling fell to US$1.2883, just barely above its US$1.2798 post-Brexit vote level that marked a three-decade low against the US greenback.

The pound also sank against the Singapore dollar overnight, falling for the first time below the S$1.73 level to S$1.7271 as of 11 pm on Monday, Singapore time. It recovered some ground to trade at S$1.7300 around 2:20 pm on Tuesday (Aug 16), down 0.37 per cent from its close overnight of 1.7364.

The currency's fall came as data from Britain showed London residential rents fell for the first time in six years in July, amid worries the June 23 vote to exit the European Union was already having an impact on the economy.

The rental data came on the heels of numbers showing home prices fell for the second straight month.

"In the month of August, the British pound has been the weakest currency and the trend continued today," said Kathy Lien of BK Asset Management.

"The main reason why the currency is weak is because investors are worried about this week's UK economic reports."

Even if the formal moves to leave the European Union will not be taken by the government until next year, Ms Lien said, "the damage has been done and consequences are just beginning to appear."

With additional information from the Straits Times