RE: Pound suffers biggest drop in 18 months1 Nov 2024 18:17
However, it is important to put the latest market movements in context.
Since Wednesday the effective interest rate on government borrowing has gone up by just under a quarter of a percentage point and the pound had gone down by less than a percentage point.
The moves are about a tenth of the size of those seen after the mini-Budget, which was delivered by Kwasi Kwarteng while Liz Truss was prime minister.
For example, the pound is down 0.8% against the dollar, to a two-month low.
By this stage after the mini-Budget it was down 8% against the dollar - to an all-time low.
There has also been a wider rise in borrowing costs over the past month, but that has been a global movement, led by the US.
The jump in how much the government has to pay to borrow is a signal that investors regard lending it money as being a bigger risk.
BEEB