LONDON: The pound fell against the euro on Friday to its lowest in seven weeks and was on track for its second consecutive week of losses against the common currency, with analysts attributing the fall partly to an upcoming Scottish parliamentary election.
After a strong first quarter, helped by a speedy rollout of vaccinations against COVID-19 across the United Kingdom and by dwindling expectations of negative interest rates, sterling had a weaker start to April.
While traders weighed indications of how Britain’s re-opening of shops would affect the economic recovery, they also said investors had turned more cautious ahead of the Scottish parliamentary election on May 6.
The Scottish National Party (SNP) is expected to perform well again and has vowed to push for a second referendum on independence from the United Kingdom if it wins a majority in the Scottish parliament. In early London trading, the pound fell versus the euro to 87.18 pence, its lowest level since February 26. It was down 0.1% to 86.92 pence at 1030 GMT. Versus a weakening dollar, it was 0.1% higher to $1.3790 and set for weekly gains, after ending its worst week of the year against the greenback last Friday.
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