Sterling Drops on Consumer Confidence and Budget Cuts

The Great Britain pound fell today against other most-traded currencies as the consumer confidence hasn’t recovered after it tumbled in March and on the concern that the budget cuts, planned by the new government, may curb the economy’s growth.

Nationwide Building Society’s consumer confidence index rose by one point to 74 in April, while it previously had sank to 73 points in March from 83 the month earlier. The budget deficit was at the record level of 166.5 billion pounds in the previous year and predicted to be 163 billion pounds (11.1 percent of gross domestic product) this fiscal year.

George Osborne, the Chancellor of the Exchequer, voiced his opinion about the coalition and the future of the Britain’s economy:

We’ve got a coalition agreement that commits us to significantly accelerating the reduction in the structural deficit. There’s lots of work ahead. We’ve got a very difficult economic situation.

GBP/USD traded today near 1.4592 as of 21:23 GMT after it opened at 1.4823. EUR/GBP traded at about 0.8577 up from its opening level of 0.8509.

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