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CHART - Pound crashes to below 1.20

GBPUSD News by Newsroom on 00:27 Octuber 07, 2016 EST

The pound has collapsed in the early hours during the Asian trading session this Friday.

The British currency which has been very weak since brexit lost more than 500 pips within minutes and touched the 1.20 handle against the US dollar. The pound also suffered against the euro setting leading EURGBP to a multi year high of 0.92 and getting both currencies closer to parity, a situation that was about to occur at the high of the financial crisis in 2008.

Government bonds also slid earlier today as the weaker currency boosted the market's inflation outlook. Even stocks, which have thus far been buoyed by sterling's drop, couldn't escape making loses on Thursday, with the FTSE 100 Index dropping for a second day and setting itself for a bad Friday.