Pound Falls Broadly on Dubai Debt Problems
November 26th, 2009Coincidence: London Stock Exchange Halted
Via: New York Times / Reuters:
Sterling fell on Thursday, with the euro hitting a one-month high against the UK currency, on worries about British banks’ exposure to debt problems in Dubai and concern over UK economic health.
The pound also fell sharply against the dollar, which recovered some of the previous day’s sharp losses, and dropped to a six-week low against a broadly firmer yen.
Traders and analysts said sterling was coming under pressure following Dubai’s move on Wednesday to restructure its biggest corporate debtor, Dubai World, and delay repayment on some of the company’s $59 billion (35.6 billion pounds) of liabilities.
“There are concerns regarding the extent of the exposure of the UK banks to Dubai, hence sterling is coming under pressure,” said Ian Stannard, currency strategist at BNP Paribas.
