Pound Slumps To Near 7-Year Low Vs Dollar

The pound slumped to a six and a half year low of $1.4396 against the dollar Tuesday, and was close to Monday's all-time low against the euro, as speculators picked the UK currency off as easy prey.

In subdued holiday trade dealers are looking for some easy money, and sterling fits the bill perfectly.

The pound has been battered by a plethora of awful economic news over recent weeks and now finds itself near parity with the euro, and it's lowest against the dollar since April 2002.

One-for-one with the euro seems to be on the cards, it's just a matter of when, possibly in even thinner trade tomorrow? The interesting thing will be to see how sterling fares in the new year once normal trading resumes. Will it bounce back from parity, much as we have seen when the dollar briefly breached the $2 mark against the pound a couple of times in the last few years?

Some seem to think so: Pound Poised to Gain as BOE Slows Pace of Rate Cuts