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The pound sunk by around 1% against the dollar today

The pound sunk by around 1% against the dollar today (Picture: Getty)

The pound sunk to new lows against the US dollar today amid speculation there could be a general election.

The pound sunk by around 1% against the dollar.

Boris Johnson gave a speech this evening when he did not explicitly announce a return to the polls.

However, the pound remained at historic lows, falling one cent against the dollar to 1.2069.

Even after Boris Johnson walked back through the door to 10 Downing Street following his speech, the pound did not recover and continued to trade at levels rarely seen since 1985.

David Cheetham, chief market analyst at XTB, said: The pound has been in a steady drift lower throughout the day and has fallen by around 1% against the US dollar to once more trade near the 1.20 dollar handle and languish not far from multi-decade lows.

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Generally speaking an election brings raised levels of uncertainty and is therefore negative near-term for the currency, but theres also another effect at play here.

He also suggested that there could be a recovery if an election takes place and returns a surge in support for remaining in the EU and a second referendum.

Others were less optimistic, suggesting the swings in currency fluctuations could be far more damaging longer term, as all attempts at predictions become impossible.

Sebastien Clements, a currency analyst at OFX, said: Once again, the pound is closely resembling the behaviour of an emerging market currency, where high volatility and extreme political uncertainty leRead More – Source