On hopes that an EU support deal for Greece may be closer, the euro retained value against the US currency today, while sterling lost over 1 per cent in value.
A poll has suggested that no party will win a majority in an election scheduled for 3 June 2010. As a result, investors became increasingly concerned that no incoming government will be able to fix the UK’s debt problems.
News also merged that Prudential Plc, the British insurance and pensions giant, is in talks to buy Asia’s AIG. This further damaged the foreign exchange value of the pound sterling. It fell to $1.4995 against the dollar, which is the first time it has fallen below the $1.50 mark since May 2009.
The euro, however, was up 1.5 per cent against the pound to 90.75 pence, which is its strongest value so far this year. This rise was a result of news that Olli Rehn, the EU Economic Affairs Commissioner, had visited Athens. This indicated that a deal to rescue the struggling economy could be closer to becoming reality. However, German chancellor Angela Merkel said that no decision has yet been made.
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