The pound slipped against the dollar and euro on Tuesday, as the UK’s challenging fiscal situation took center stage ahead of the upcoming Bank of England meeting and a budget announcement just weeks away.
Speculation around a reduction in the productivity forecast by the Office for Budget Responsibility weighed heavily on its value, forcing it down 0.24% to $1.3298 against the dollar. Similarly, the euro gained 0.3%, rising to 87.6 pence.
Finance Minister Rachel Reeves faces tough decisions in the lead-up to her budget presentation on November 26, with both tax hikes and spending cuts anticipated. Meanwhile, the Bank of England is likely to keep interest rates steady at its next meeting, despite ongoing debates about a potential rate cut.
(With inputs from agencies.)
