The pound had its biggest quarterly drop against the dollar in more than four years as the contraction of the economy in the three months to December fueled concerns of a recession unprecedented triple immersion.
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Sterling declined against all but two of its 16 major counterparts in the quarter that ended yesterday. Gross domestic product fell 0.3 percent in the final three months of last year, the Office for National Statistics said in London in January and confirmed in the week.
The currency trimmed decreases the duration of the meeting of the Bank of England, the most recent policy damped speculation by more asset purchases as the financial crisis and the Cyprus boosted demand for UK assets as a haven.
"Sterling has been under pressure in the first quarter," said Henrik Gullberg, a currency strategist at Deutsche Bank AG in London. "The pound has recently gained some ground against the euro due to the situation in Cyprus. But it is unclear how long this recovery will last given the poor economic fundamentals and the outlook for the UK"
The pound fell 6.7 percent in the first quarter to $ 1.5172 at 4:56 pm London time yesterday, after falling on 12 March to $ 1.4832, the weakest since June 2010 . The fall in this quarter was the highest since the three months to December 2008. The British currency fell 3.9 percent against the euro in the past three months to 84.50 pence.
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