Many companies featured on Money advertise with us. Opinions are our own, but compensation and
in-depth research determine where and how companies may appear. Learn more about how we make money.

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

By Brad Tuttle
October 7, 2016
Alastair Grant—AP

The value of the British pound tumbled sharply overnight, plunging nearly 10% on international exchange markets before bouncing back up nearly as steeply. The takeaway is that the pound is worth 2% less versus the U.S. dollar compared to yesterday, and British sterling’s value is down nearly 5% just this week. It’s also down roughly 20% compared to the recent past.

As of Wednesday, the pound was worth $1.27, a 31-year low for the UK’s currency. In the fall of 2014, by contrast, one British pound was worth $1.60. In effect, everything in the UK is discounted by over 20% for people using the newly powerful American dollar.

Overnight on Thursday, the pound dropped as low as $1.18, before recovering to $1.23 on Friday morning, Bloomberg News reported. The decrease was reminiscent of what happened in June, when the pound was hammered after the UK voted for Brexit—the nickname for Britain leaving the European Union. Soon after the vote, the pound was worth $1.37, compared to $1.49 just beforehand.

Read Next: Thanks Brexit! Here’s How Much Cheaper It Is for Americans to Visit the UK Now

The latest decreases in the value of the pound come as a result of “growing fears of a ‘hard’ exit by Britain from the European Union,” according to Reuters, a situation that has “sent a shiver through world markets.”

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

EDIT POST