Sterling outperforms major currencies against dollar

The pound sterling is set to end 2024 as the top-performing major currency against the dollar, despite a 1.4 per cent annual decline, supported by a UK economy that outperformed expectations.

However, sterling dropped over 6 per cent in the fourth quarter, weighed down by a stronger dollar and signs of UK economic weakness.

The Bank of England (BOE) is projected to cut interest rates twice in 2025 after two reductions in 2024, with policymakers expressing concerns about persistent domestic inflation.

Meanwhile, the pound gained 4.5 per cent against the euro this year as the eurozone economy slowed sharply, prompting the European Central Bank (ECB) to enact deeper rate cuts. The euro last traded at 82.98 pence, near its weakest levels since mid-2016.

Attribution: Reuters

Subediting: Y.Yasser