Sterling ‘may fall by 5% in value’

STERLING could fall by 5% in value against the euro before the end of the year, Ulster Bank economist Niall Dunne said yesterday.

“The relative strength of the British economy and rising interest rates boosted demand for sterling over the past 18 months, but if British economic growth is set to slow as nervous consumers spend less, then it seems likely that the pound will fall,” said Mr Dunne.

Ulster Bank’s forecast for a weaker pound is based on a revised outlook for British interest rates.