Sterling trades at 87.2 pence against euro on concerns for outlook of British economy

Latest economic figures highlighted that the UK economy is showing signs of strain from surging prices.

Markets are digesting implications of last week's announcement by new British Prime Minister Liz Truss on capping UK consumer energy bills for two years, at a likely cost of €115bn

Sterling briefly fell to its lowest level since early 2021 against a robust euro, while news that Britain's economy grew less than expected in July highlighted a weak growth outlook for the country.

The UK currency had fallen to below 87.2 pence before rallying, as the euro benefited from hawkish European Central Bank commentary over the weekend.