Pound falls near 15-year low against dollar

Sterling plunged to within a fraction of a 15-year low against the dollar yesterday. The pound fell across the board, dropping to a five-year low against the yen, and weakening against the euro.

Sterling plunged to within a fraction of a 15-year low against the dollar yesterday. The pound fell across the board, dropping to a five-year low against the yen, and weakening against the euro.

The decline will bring relief to UK manufacturers, who received another boost from a 3 per cent fall in the oil price ahead of Opec's meeting in Vienna tomorrow.

Opec leaders will discuss whether to raise production to help bring down the price. Yesterday Brent fell more than $1 to $34.38 a barrel after the Saudi oil minister, Ali al-Naimi, said prices must fall to between $22 and $28.

On the currency markets, the euro rose from Thursday's lifetime lows after European politicians tried to show a united front at the start of yesterday's finance ministers' meeting.

The pound tumbled as low as $1.4189, the first time it has fallen below $1.42 since February 1993. A fall below the next key landmark of $1.4085 will take it to its lowest level since 1985.

Dealers said the Bank of England's decision to hold rates at 6 per cent for the seventh month in a row on Thursday added to sterling's weakness.

The euro rose slightly against the dollar and the pound after Austria's finance minister, Karl-Heinz Grasser, raised the prospect of intervention. "For the first time, it is necessary to send the signal from every finance minister that we are committed to a strong euro," he said before the Ecofin meeting in Paris. "I am in favour of intervention at the right time. Words are not enough in the long run."

Earlier, Sirkka Hamalainen, a board member of the European Central Bank, said the ECB was finding it harder than it would like to communicate its policy intentions to markets.