The pound fell to its weakest level in a month against the dollar as a Bank of England policy maker said the UK economy may slip back into a recession.

Sterling snapped four days of gains versus the euro. There is a “real risk” of a second recession, Martin Weale was quoted by the London-based Times as saying in an interview. UK lenders approved fewer mortgages last month than economists predicted, British Bankers’ Association data showed today. UK 10-year bond yields slid to a record as stock losses boosted demand for safer assets.
The “comments have had a visible impact on sterling across the board,” said Roberto Mialich, a senior currency strategist at UniCredit SpA in Milan. “For sterling the situation is looking more difficult. If risk aversion continues to weigh on the market, the pound will suffer.”
The pound depreciated by 0.7 percent to $1.5404 as of 10:23 A.M. in London, after sliding to $1.5373, the lowest level since July 23. It was 0.5 percent weaker at 82 pence against the euro, after reaching its strongest level since June 30.
(Source: Bloomberg)